By Rob Starr, Content Manager, Big4.com
Total volume and proceeds raised in the 2012 IPO market increased over 2011, despite the slowdown in activity during the fourth quarter, according to IPO Watch, a quarterly and annual survey of IPOs listed on U.S. stock exchanges by PwC US.
Although the 2012 volume of IPOs surpassed 2011, the value raised — when excluding the $16.0 billion Facebook IPO — was only $24.7b, which was a 30% decrease in proceeds raised. The current year lacked the large number of billion dollar plus IPOs in 2011, and saw the average IPO size in 2012 decrease to $180 million when excluding Facebook, which was a reduction of 32% from the average IPO in 2011 of $265 million.
“Following a very strong October, companies began to take a more cautious approach given the presidential election, uncertainty of the Congressional budget negotiations and the fiscal cliff,” said Henri Leveque, leader of PwC’s U.S. Capital Markets and Accounting Advisory Services. “Still, the 2012 IPO market surpassed the prior year on the strength of several larger offerings and opportunistic moves by smaller companies looking to tap the public markets when windows opened”
According to PwC, financial sponsors continued to remain active in U.S. IPOs, backing 42 percent of Q4 2012 IPOs and 68 percent of the IPOs on a year-to-date basis. Private equity also remained active in executing on new deals, accounting for 18 percent of total M&A deal volume in 2012, according to PwC’s M&A Outlook.