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Friday 12 June 2009
Singapore poised for IPO rebound: Merrill Lynch
Singapore may be poised for its first $1 billion initial public offering (IPO) since 2006 as rallying stocks lure companies back to equity markets, Bank of America Corp’s Merrill Lynch unit said.
(SINGAPORE) Singapore may be poised for its first $1 billion initial public offering (IPO) since 2006 as rallying stocks lure companies back to equity markets, Bank of America Corp’s Merrill Lynch unit said.
The first IPOs are expected to be from commodities and real-estate companies that are likely to benefit from an economic recovery, Keith Magnus, Merrill Lynch’s managing director for investment banking in Singapore and Malaysia, said in an exclusive interview on June 8.
Merrill may start marketing as many as three first-time share sales in the second half of 2009, he said, declining to name the companies.
‘Given the more stable environment, the market can expect at least one IPO of significant size in excess of $1 billion,’ Mr. Magnus said.
The benchmark Straits Times Index (STI) has rallied more than 60 per cent from a five-year low on March 9 amid speculation the global financial crisis is easing, boosting investor appetite for new shares.
At least 17 IPO applications were withdrawn last year, according to data from the Monetary Authority of Singapore, as a record 49 per cent drop in the STI caused companies to delay listings.
About US$29 trillion was wiped from the value of global equities in 2008.
Teho International Ltd, Japan Foods Holdings Ltd and Westminster Travel Ltd have raised $17 million in Singapore’s only three IPOs this year.
That has put Singapore’s IPO industry on course for its worst half-year since Bloomberg started tracking the data in 1999. Merrill Lynch was not involved in those three transactions.
Companies garnered US$1.2 billion last year from initial share sales in Singapore, including Indiabulls Properties Investment Trust, an offering managed by Merrill Lynch and Deutsche Bank AG, data compiled by Bloomberg showed.
That amount is 77 per cent less than the US$5.3 billion raised in 2007.
This year’s stock recovery may embolden more companies, especially those tied to commodities and property, to tap investors, Mr. Magnus said.
Four of the five best performers on the STI this year are commodity-related companies.
Olam International Ltd, a supplier of agricultural commodities, soared 100 per cent in 2009, making it the gauge’s best performer.
There are also signs that property demand in the city-state is recovering.
City Developments Ltd, which said last month it has raised prices at one of its projects and is speeding up the launch of another project, climbed 117 per cent in the past three months, making it the best performer during the period.
‘There seems to be an air of stability in the financial markets,’ Mr. Magnus said. ‘If we catch the right window, I think we are going to see a slew of IPOs getting done.’ - Bloomberg
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Singapore poised for IPO rebound: Merrill Lynch
Bloomberg
12 June 2009
(SINGAPORE) Singapore may be poised for its first $1 billion initial public offering (IPO) since 2006 as rallying stocks lure companies back to equity markets, Bank of America Corp’s Merrill Lynch unit said.
The first IPOs are expected to be from commodities and real-estate companies that are likely to benefit from an economic recovery, Keith Magnus, Merrill Lynch’s managing director for investment banking in Singapore and Malaysia, said in an exclusive interview on June 8.
Merrill may start marketing as many as three first-time share sales in the second half of 2009, he said, declining to name the companies.
‘Given the more stable environment, the market can expect at least one IPO of significant size in excess of $1 billion,’ Mr. Magnus said.
The benchmark Straits Times Index (STI) has rallied more than 60 per cent from a five-year low on March 9 amid speculation the global financial crisis is easing, boosting investor appetite for new shares.
At least 17 IPO applications were withdrawn last year, according to data from the Monetary Authority of Singapore, as a record 49 per cent drop in the STI caused companies to delay listings.
About US$29 trillion was wiped from the value of global equities in 2008.
Teho International Ltd, Japan Foods Holdings Ltd and Westminster Travel Ltd have raised $17 million in Singapore’s only three IPOs this year.
That has put Singapore’s IPO industry on course for its worst half-year since Bloomberg started tracking the data in 1999. Merrill Lynch was not involved in those three transactions.
Companies garnered US$1.2 billion last year from initial share sales in Singapore, including Indiabulls Properties Investment Trust, an offering managed by Merrill Lynch and Deutsche Bank AG, data compiled by Bloomberg showed.
That amount is 77 per cent less than the US$5.3 billion raised in 2007.
This year’s stock recovery may embolden more companies, especially those tied to commodities and property, to tap investors, Mr. Magnus said.
Four of the five best performers on the STI this year are commodity-related companies.
Olam International Ltd, a supplier of agricultural commodities, soared 100 per cent in 2009, making it the gauge’s best performer.
There are also signs that property demand in the city-state is recovering.
City Developments Ltd, which said last month it has raised prices at one of its projects and is speeding up the launch of another project, climbed 117 per cent in the past three months, making it the best performer during the period.
‘There seems to be an air of stability in the financial markets,’ Mr. Magnus said. ‘If we catch the right window, I think we are going to see a slew of IPOs getting done.’ - Bloomberg
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