Strong IPO Performance for Europe in Q4 Bodes Well for 2011, PwC
OREANDA-NEWS. February 04, 2011. European listings activity quadrupled in the last quarter of 2010 over the previous quarter, led by initial public offerings (IPOs) in London, according to IPO Watch Europe, the PwC survey tracking the volume and value of IPOs, reported the press-centre of PwC.
European exchanges attracted just over EUR 10bn of IPOs compared to EUR 2.5bn in the previous quarter, but London claimed the lion’s share of initial fundraisings in Q4 with EUR 3.6bn generated compared with EUR 1.7bn in Q3 2010. London accounted for 49 of the 130 European listings in the last quarter.
Richard Weaver, capital markets partner, PwC, said:
“European IPO markets had a strong finish to the year with the value of deals almost double the preceding quarter of 2010. London again led the way but there was activity across a large number of exchanges. Despite economic and political uncertainties across Europe, stock markets have started the New Year strongly and this has added to the positive momentum for the IPO markets into 2011.”
The largest IPO in the fourth quarter was Enel Green Power’s EUR 2.2bn dual listing in Italy and Spain. Oslo attracted two IPOs which both topped EUR 1bn, while London’s biggest single fundraising came from the float of media company Mail.ru Group which generated EUR 669m.
Despite the improved performance, Europe ended up in third place for the third year running raising EUR 26bn behind the US which raised EUR 28bn and Greater China which raised EUR 98bn.
The US markets benefited from the General Motors IPO which raised EUR 14.7bn, putting their total IPO offering value just ahead of Europe. Greater China enjoyed strong activity across all the exchanges with two very notable transactions; AIA raising EUR 12.8bn and Agricultural Bank of China raising EUR 15bn.
Hong Kong emerged as a market attracting international listings during 2010. Investors were mainly interested in areas such as branded fashion goods or companies where there was a clear Chinese market connection.
Tom Troubridge, Head of capital markets, PwC, said:
“Barring any unexpected financial or political shocks, the momentum built in the fourth quarter of 2010 should continue into 2011 for Europe's IPO markets. Privatisations will feature in 2011 as European governments take steps to reduce their levels of borrowing. In addition to domestic deals, there should be a return of international transactions into London from emerging economies such as Russia, Kazakhstan and India. A return to the record years of 2006 and 2007 looks unlikely, but 2011 should continue the improving trend seen in 2010. Elsewhere, the US should also have a good year as the economy continues to recover – but IPO offering values may not reach the 2010 level which included the General Motors IPO.
Greater China is also expected to have another strong year in line with its economic growth. An absence of the jumbo listings seen in 2010 may mean that 2011 does not see the same scale of IPOs. Hong Kong will continue to market itself to international companies and represents a growing competitive threat to London and New York – but only for certain companies.”
Macy Coffey, PwC partner, CEE Capital Markets Leader comments on the Russian issuers:
“The last quarter of 2010 saw six listing transactions of Russian issuers with placements at LSE, HK and local exchanges. The whole year registered twelve deals ranging from USD 10 million to USD 2.2 billion of the Russian aluminum giant Rusal.
The total IPO volume for 2010 was USD 5.3 billion, significantly up a trivial USD 105 million in 2009, but still quite below the 2007 USD 21.7 billion record and USD 8-9 billion 2010 forecast made by experts at the beginning of 2010. The reason for the shortfall appears to be lower pricing for Russian risk. Most of the 2010 deals were closed at the lower end of price range, such as Transcontainer, IRC, Russian Sea and others. Thus, quite a few Russian potential issuers in 2010 postponed listings while they wait for the market to recover.”
Комментарии