Budget 2025′s attempt to breathe life into the waning Irish stock market — with relief on up to €1 million of initial public offering (IPO) expenses and promises to waive stamp duty on certain share trading — is no game-changer.
But the fact that the 231-year-old exchange even got a mention in Minister for Finance Jack Chamber’s budget speech — and is now on his radar — was something of a coup for the market, where the number of listings has fallen by half, to 26, since the financial crash.
Euronext Dublin, as the exchange is now known, has suffered the greatest pace of shrinkage of a western European market in an era of private equity-backed, public-to-private deals trumping flotations and, more recently, beasts like CRH, Flutter Entertainment and Smurfit WestRock leading a flotilla charging across the Atlantic to the Wall Street.
The reasons for the dearth of Irish IPOs in the past 10 years are many.
But HealthBeacon, the last company to float — in December 2021 — hasn’t exactly illuminated a path for IPO prospects. The medical technology company was taken over in a rescue deal earlier this year by one of its distribution partners, US-based Hamilton Beach Brands, after imploding.
Nor has the second-last company to take the plunge: Corre Energy, the Irish-run but Dutch-based energy storage developer for renewable power, which joined the Iseq in September 2021.
Both, it’s now clear, IPO’d before they were ready. Each may have had compelling products — in HealthBeacon’s case, a digital sharps bin that helped people stick to injection schedules; in Corre’s, a solution to store energy in underground salt caverns.
Each could have done with a few more rounds of private-market funding to establish a proper investment case, before looking to join the Iseq.
Corre has seen its share price plunge 90 per cent so far this year — leaving its market value at just over €16 million. The wider international green energy sector has been generally out of sorts — with the S&P Global Clean Energy stocks index off 9 per cent over the same period — as the capital-intensive sector struggles with heightened interest rates and a hangover from when green energy stocks were on turbocharge during the pandemic.
But Corre’s issues are much more acute.
When the company floated three years ago, it reckoned its key Zuidwending (ZW1) project in the Netherlands — the first large-scale compressed air energy storage (CAES) facility earmarked for construction in Europe in five decades — would come on stream in 2025 or 2026. The problem for investors is that Corre has offered little detail on the returns they can expect from the facility, which will be capable of supplying 320 megawatts (MW) of electricity to the grid for up to 3½ days.
More recently, Corre had aimed to have ZW1 up and running by the end of 2026. However, it disclosed this week that permit challenges have pushed back a crucial final investment decision on the project after 2027 and that it might not start operations until the end of the decade.
Corre also revealed that its 320MW Green Hydrogen Hub development in Denmark — the second key project pitched in its IPO documents — has run into issues sourcing enough cavern space, raising questions about its economic viability.
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On a brighter note, a new 320MW battery energy storage project set up as a joint venture in the Netherlands in July could be hooked up to the grid by mid-2027. Batteries, a more established type of storage to CAES, are more costly and have much shorter lifespans, but the company needs to get something up and running as soon as possible — even if it means straying from its original investor pitch.
Corre has needed a large cash injection for some time — and a significant one at that, if it is to secure the best deals possible as projects come to financial investment decisions. With less than €1.1 million of cash in the kitty at the end of last year, it hired Rothschild in April to secure a big strategic investor.
The longer this has dragged on, the more the share price has been hit. A €2.58 million stopgap cash call among investors in July was followed by the company being forced to secure a €5 million emergency loan five weeks ago.
The exit of founding director Darren Patrick-Green in February after being linked by UK revenue officials to a tax avoidance scheme — which he has insisted he was unaware of — was followed by revelations in August that large blocks of Corre shares had been committed by a holding company as collateral for loans.
It is understood that the collateral issue cropped up during due diligence by investors Rothschild had brought to the table. The talks stalled and have only recently recommenced. Corre conceded this week that it may be 2025 before a deal is reached.
Investors behind the latest bailout loan — Northern Irish property developer Frank Boyd, his son, Brendan, and Nick Furlong, an investor with a soft spot for the Iseq’s less-straightforward plays — have moved to populate the board with their nominees. An extraordinary general meeting on the matter is being held on Monday. They are also considering appointing an executive to sit alongside Corre’s founding chief executive, Keith McGrane.
The odds of Corre still being on the Iseq in six months’ time are slim.
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