The U.S. government shutdown is impacting the U.S. stock IPO market: SEC review suspended, end-of-year listing efforts blocked.

The prolonged U.S. government shutdown is slowly strangling the hopes of companies that are still aiming to go public before the end of the year as the Securities and Exchange Commission (SEC) filing reviews are stalled, preventing these companies from taking any alternative measures. Companies that applied for an Initial Public Offering (IPO) in September or October, such as the tax advisory firm Andersen Group, medical supplies provider Medline, and the intelligent investment company Wealthfront, were still likely to go public before Thanksgiving on November 27th until recently. With the shutdown lasting nearly two months, these companies have almost missed the opportunity to utilize SEC's remedial measures - such as setting issuance terms and starting a 20-day automatic effective countdown - in order to list before the holidays. Given the mixed responses from companies that are determined to go public, those that have chosen to wait and see may be making the right decision. Although the SEC has taken measures to facilitate companies going public during the government shutdown, Steven Halperin, head of Public Equity at Moelis, stated that companies still have limited ability to adjust issuance terms based on market demand, and that the discount rate for IPOs is still relatively high. Halperin said, "This is an issue in executing these transactions, you really have to want to go public and not be so sensitive to valuation." The market has put some companies' determination to the test. The stock of the travel software company Navan (NAVN.US) has dropped by as much as 36% since its listing on October 30th, while the stock price of the biotechnology company MapLight Therapeutics (MPLT.US) has been hovering around the IPO price. Electric aircraft company Beta Technologies (BETA.US) opened on Tuesday with a drop in stock price, followed by a rebound. Ilir Mujalovic, Co-Head of Global Equity Capital Markets and Financial Institutions, Inc. at A&O Shearman, stated that the automatic effectiveness route makes sense for companies that are confident the SEC has largely completed their IPO application review. He said, "This method is only effective when the company is confident that its registration statement is complete and accurate. You still need to ensure that due diligence has been done, and there are no material misstatements or omissions." Mujalovic added that companies that began preparing for an IPO process earlier in 2025 are still likely to go public this year, but those waiting for substantial feedback from the SEC are more likely to wait until next year, especially with the holidays approaching. If the U.S. government shutdown continues indefinitely, the listing time for any companies that had planned to use the automatic effectiveness method will be delayed until the week after Thanksgiving. Traditionally, the week after Thanksgiving is not an optimal time for companies to go public as many investors are traveling or on holiday. This leaves the first few weeks of December as their last option - bankers generally do not recommend operations during this period as investors are often not willing to make significant investments near the end of the year. Some are hopeful that the U.S. government shutdown will eventually be resolved. However, due to the regulatory agency having to deal with a backlog of files, the SEC's review process may still slowly return to normal. Mujalovic said, "Once the SEC reopens, there will be a long queue, and once resubmitted, the SEC may not be able to respond as quickly as usual."