Global IPO proceeds surge in Q1

Increase in North American IPOs comes amid slower performance in Asia Pacific

Global IPO issuance soared in the first quarter of 2013 compared to the same period last year, as growing IPO activity in North America on an improved economic outlook more than made up for a slowdown in the Asia Pacific markets, according to research by Renaissance Capital.

Global IPO proceeds increased 48 percent in the first quarter to $18.4 bn, from $12.4 bn in the same period of last year, says the international IPO research and tracking firm in its latest quarterly report. IPOs in the US accounted for 35.8 percent of the worldwide total, or $6.6 bn, while IPO activity slowed in Asia to $3.5 bn, or 19.3 percent of global proceeds.

‘IPO issuance in Q1 2013 was led by North America,’ Renaissance says in a research note. ‘The Asian markets lost share as the historically active China A-share market did not produce a single IPO larger than $100 mn for the second consecutive quarter. Poor stock market returns have dampened investor interest in the region, while increasingly stringent listing regulations imposed by the China Securities Regulatory Commission have held back issuance.’

European IPO proceeds, although smaller than those in the US, more than doubled in the first quarter from a year earlier to $4.5 bn from $2.2 bn, Renaissance says. Latin America and the Middle East and Africa, which registered no IPO proceeds in the first quarter of 2012, pulled in a combined $3.8 bn in six IPOs.

IPOs on average were much bigger in the first quarter of this year, as the median deal size grew 54.2 percent to $265 mn, while the number of actual deals dropped 11.1 percent to 40, notes Renaissance. Some 26.8 percent of the global proceeds came through the NYSE, while the Mexican Stock Exchange came second, with 12.4 percent, and the London Stock Exchange placed a close third, with 12.3 percent.

IPO returns also increased, rising an average of 13.2 percent compared to the first quarter of 2012. Returns in North America rose 22.2 percent, returns in Europe increased 6.8 percent and Asia Pacific returns grew only 1.9 percent, according to the data provider.

In terms of industries, the financial sector led IPO issuance in the first quarter, accounting for 47.8 percent of the global total, or about $8.8 bn. Next came healthcare, at 12.8 percent, or $2.2 bn, and the energy sector, with 9.9 percent, or $1.8 bn.

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