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Ernst & Young: Global IPO activity expected to pick up

By Rob Starr, Content Manager,

Maria Pinelli, Ernst & Young’s Global Vice Chair Strategic Growth Markets, says: “The US, Toronto, London, Frankfurt, and Moscow stock exchanges lifted significantly in the fourth quarter, thus suggesting that signs of stability in equity markets and supportive central bank policy are starting to take effect. We believe the market is likely to see smaller offerings initially while market and investor confidence builds.”

She is speaking to a new optimism springing from Ernst & Young’s Year End Global IPO Update shows that in the year to the end of November, there were 768 IPOs globally which raised US$118.5b, down 37% and 30% respectively compared to full year 2011.

More than half the 36 capital raisings in Australia in 2012 were small resource companies with average capital raised less than US$10m and a single IPO – Woolworths’ spin-off of retail properties into the Shopping Centres Australasia Property Group – accounted for more than half the total capital raised for the year.

This quarter, the US markets raised US$7.3b (29 IPOs), narrowing the lead on the Asian markets, which raised US$8.8b (59 IPOs). European exchanges also saw something of a return to form, with deal value reaching US$7.0b (20 IPOs). Globally, year-on-year, the picture for Q4 remains somewhat depressed. The number of deals fell 46% from 255 deals in Q4 2011 to 136 deals in Q4 2012, whereas by capital raised, it only fell 6% from US$29.1b in the same period last year to US$27.3b this quarter.



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