Second Quarter IPO Market Nearly Triples 2009 Activity
Continuing the momentum from the second half of 2009, U.S. IPO activity pushed forward in the second quarter of 2010, according to PricewaterhouseCoopers' U.S. IPO Watch, a quarterly and annual analysis of IPOs on U.S. stock exchanges.
A year-over-year comparison indicates a significant increase in IPO activity in the second quarter of 2010, nearly tripling the number of deals seen during the same period in 2009. For the three months ending June, there were 39 IPOs that raised $5.1 billion compared with the 12 IPOs raising $1.6 billion in the second quarter of 2009.
For the first six months of the year, IPO volume reached 66 deals, raising $9.2 billion versus 14 deals raising $2.3 billion in the same period last year.
While the number of IPOs was up in Q2, the second quarter witnessed a steady decline in the number of completed offerings each successive month, with 17 completed deals in April, followed by 11 in May and 11 IPOs in June. In May and June, 15 IPOs were either withdrawn or postponed, according to PwC.
"Despite recent market hurdles, the IPO pipeline continues to build with an additional 68 companies registering new deals during the second quarter," said Scott Gehsmann, capital markets partner with PricewaterhouseCoopers' Transaction Services. "While recent market swings have posed a short-term threat to companies looking to price their IPOs, the path to a successful IPO is a journey — not a sprint. Interim market challenges provide opportunities to reflect on the adequacy of the issuer's readiness to enter the public equity markets and the post-IPO strategic plan."
Financial sponsors continue to provide leadership in the U.S. IPO market, according to PwC. The second quarter saw 32 of the 39 new deals raising $4.2 billion coming from financial sponsors, representing approximately 84% of total proceeds.
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