IPOs on the up

BY Richard Summerfield

2017 has been a bumper year for global IPO activity. According to a new report from EY, by deal number, 2017 was the most active year for IPOs globally since 2007.

The report, 'Global IPO trends: Q4 2017', notes that to December there were 1624 IPOs with $188.8bn raised – an increase of 49 percent by number of deals and 40 percent by capital raised, compared with 2016.

IPO activity in all regions has seen double digit growth, with the Asia-Pacific region dominating. There was an increase of 44 percent in Asia-Pacific in 2017 with 935 IPOs completed. The bulk of the activity in the region was completed in the first half of the year.

Q4 was the weakest period with only 240 deals – a 4 percent year-on-year decline. Proceeds in 2017, at $73.2bn, were only 0.2 percent higher than in 2016, indicative of a decline in average deal sizes.

Exchanges based in Asia-Pacific took the top three rankings globally by deal number. Greater China exchanges saw 582 new listings in 2017 – a 68 percent increase on 2016.

IPOs in the US also saw a notable increase in 2017, with 174 raising $39.5bn, an increase of 84 percent in proceeds and 55 percent by volume compared with 2016. According to EY, the Americas were responsible for 13 percent of global deals and 27 percent of global IPO proceeds in 2017.

Dr Martin Steinbach, EY Global and EY EMEIA IPO leader, said: “2017 will close with more IPOs than any year since 2007. With this great momentum, IPO candidates are lining up for 2018. The outlook appears bright, driven by lower volatility across regions, high valuation levels and a renewed appetite for cross-border IPOs, particularly in the US, Hong Kong and London. A healthy global pipeline across a broad range of sectors and markets suggests IPO activity levels will be up with more megadeals, thereby increasing the global proceeds in 2018.”

2018 is also expected to be a notable year for IPO activity, with many mega-deals said to be on the horizon. Emerging markets contributed strongly to 2017’s IPO activity, and the EY report notes that a number of state-owned enterprise IPOs are expected across the Middle East and North Africa next year, with exchanges in the US, Greater China and the UK also likely to feature heavily.

Report: EY Global IPO trends: Q4 2017

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