Global IPO Activity Falls by More Than Half: E&Y Report
By LYNETTE KHOO 20 December 2008
Global initial public offering (IPO) activity has fallen by more than half from the record-breaking pace of last year.
The first 11 months of this year saw a total of 745 IPOs worldwide raising US$95.3 billion in capital. In both absolute and value terms, these 2008 figures are less than half the 1,790 IPOs and US$256.9 billion raised for the 2007 corresponding period, according to Ernst & Young’s year-end Global IPO update.
Although there is still one more month of data to come in for the year, data for the whole of 2008 are still expected to be way below the record numbers of 2007, with 1,979 IPOs raising US$287.1 billion in capital.
‘It is clear that the challenging market conditions have affected investor confidence and willingness to list during this period,’ said Max Loh, IPO leader and partner (assurance and advisory business services) at Ernst & Young LLP.
‘It is difficult to predict when IPO activity will recover, as capital markets need first to stabilise in order to restore investor confidence,’ he added.
Data from Dealogic shows that 298 IPOs have been postponed or withdrawn this year to-date compared with 167 for the whole of last year.
Asian IPOs have raised the most capital for the first 11 months at US$29.7 billion, with Greater China making up 60 per cent, the E&Y report says. Asia also topped the number of IPO deals, with 337 versus 161 in Europe and 91 in North America.
Of the top 20 IPOs, 15 came from emerging markets. But IPO activity in these markets have also fallen significantly from last year, with the BRIC (Brazil, Russia, India, China) markets recording 163 deals that raised US$28 billion in the first 11 months, down from 365 deals and US$106.8 billion in capital over the same period last year.
The most active stock exchange in IPO deals was Australian Securities Exchange, followed by London AIM and Hong Kong Stock Exchange (HKEx). In terms of the capital raised, the top three exchanges are the New York Stock Exchange, which accounted for 26.3 per cent of capital raised, thanks to the mega listing of Visa Inc; London Stock Exchange; and HKEx.
Singapore Exchange (SGX) ranks fourth in terms of IPO deals and is in eighth place in capital raised. According to the E&Y report, the 22 IPOs on SGX raised total funds of US$931 million.
Data from Dealogic shows that IPO issuance in the Asia-Pacific stands at just US$21.4 billion for the first 11 months, a 71 per cent slump from the same period last year, as the number of deals fell to 286 from 623.
Notwithstanding bearish market conditions, Mr. Loh said that companies that are keen on listing should use this time to prepare themselves to take full advantage once the IPO window re-opens.
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Global IPO Activity Falls by More Than Half: E&Y Report
By LYNETTE KHOO
20 December 2008
Global initial public offering (IPO) activity has fallen by more than half from the record-breaking pace of last year.
The first 11 months of this year saw a total of 745 IPOs worldwide raising US$95.3 billion in capital. In both absolute and value terms, these 2008 figures are less than half the 1,790 IPOs and US$256.9 billion raised for the 2007 corresponding period, according to Ernst & Young’s year-end Global IPO update.
Although there is still one more month of data to come in for the year, data for the whole of 2008 are still expected to be way below the record numbers of 2007, with 1,979 IPOs raising US$287.1 billion in capital.
‘It is clear that the challenging market conditions have affected investor confidence and willingness to list during this period,’ said Max Loh, IPO leader and partner (assurance and advisory business services) at Ernst & Young LLP.
‘It is difficult to predict when IPO activity will recover, as capital markets need first to stabilise in order to restore investor confidence,’ he added.
Data from Dealogic shows that 298 IPOs have been postponed or withdrawn this year to-date compared with 167 for the whole of last year.
Asian IPOs have raised the most capital for the first 11 months at US$29.7 billion, with Greater China making up 60 per cent, the E&Y report says. Asia also topped the number of IPO deals, with 337 versus 161 in Europe and 91 in North America.
Of the top 20 IPOs, 15 came from emerging markets. But IPO activity in these markets have also fallen significantly from last year, with the BRIC (Brazil, Russia, India, China) markets recording 163 deals that raised US$28 billion in the first 11 months, down from 365 deals and US$106.8 billion in capital over the same period last year.
The most active stock exchange in IPO deals was Australian Securities Exchange, followed by London AIM and Hong Kong Stock Exchange (HKEx). In terms of the capital raised, the top three exchanges are the New York Stock Exchange, which accounted for 26.3 per cent of capital raised, thanks to the mega listing of Visa Inc; London Stock Exchange; and HKEx.
Singapore Exchange (SGX) ranks fourth in terms of IPO deals and is in eighth place in capital raised. According to the E&Y report, the 22 IPOs on SGX raised total funds of US$931 million.
Data from Dealogic shows that IPO issuance in the Asia-Pacific stands at just US$21.4 billion for the first 11 months, a 71 per cent slump from the same period last year, as the number of deals fell to 286 from 623.
Notwithstanding bearish market conditions, Mr. Loh said that companies that are keen on listing should use this time to prepare themselves to take full advantage once the IPO window re-opens.
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