Is A BrewDog IPO Expected Anytime Soon?

There has been much speculation about a BrewDog IPO, and with many wondering when, or if it will happen, comments from a co-founder may provide some insight into what is a changing UK market.

The soonest an IPO would likely happen is now 2025, but the tax landscape could have a say on how the company decides to take the next steps of it's journey, with both an IPO, or private equity still looking like viable options.

BrewDog co-founder James Watt making a critique of proposed hikes in capital gains tax rates by Labour's Keir Starmer and Rachel Reeves could shed some light on his thoughts on the matter. As the craft beer behemoth eyes a potential £1.8 billion IPO on the London Stock Exchange, Watt's remarks underscore the potential tax implications for successful entrepreneurs and business owners in the United Kingdom.

A BrewDog listing would be a major milestone, and contemplating a stock market debut that could propel the company's valuation to ~£2 billion would be an opportunity for early stage private equity to consider exiting. This move could also be financially rewarding for Watt, who may gain approximately £420 million (at the above speculated valuation) if he were to sell his 21% equity stake in the company he co-founded with Martin Dickie 17 years ago.

The shadow of prospective changes to the capital gains tax looms large over such financial windfalls. Reports indicate that the tax rate could surge to as high as 39% for certain earners, sparking concern among investors and business owners akin to Watt. The BrewDog tycoon's own fortunes could be significantly affected by such policy shifts, reducing his net gain from the IPO.

Watt's recent criticisms extend to both ends of the political spectrum—in his view, the current state of the UK is “the worst” it has been, following 14 years under Conservative Party rule. His disapproval doesn't stop at domestic policies; Watt also aired warnings against reclassifying national debt in a manner that licenses further borrowing, arguing that it may offer short-term relief but portends detrimental long-term effects.

Despite fervent discussions and speculation regarding tax reform, the HM Treasury offered no comments on potential changes, emphasizing that official stances on fiscal policies are disclosed during set fiscal events.

BrewDog's future strategies, including the possibility of an IPO or a private equity sale, are yet to be affirmed, propelling the company and its founders into a critical juncture teeming with financial and regulatory challenges. As for Watt, his role as a significant shareholder will continue to draw attention as the company prepares for its next significant leap, all while navigating the turbulent waters of the UK's tax landscape.