Global IPOs have best start to year on record

Monday, 28 February 2011 00:01 - - {{hitsCtrl.values.hits}}

LONDON (Reuters) - Global listings activity has been the highest on record so far this year, with firms raising a total of $24 billion from initial public offerings (IPOs), according to Thomson Reuters data on Friday.

Asia, which dominated equity capital markets in 2010, continued to lead the field, with China accounting for 41 percent of issuance, including wind turbine maker Sinovel Wind’s $1.4 billion listing last month.

Boosted by strong energy and commodity prices, energy and power has been the most active sector, making up 30 percent of fundraising, followed by industrials on 16 percent.

U.S. pipeline company Kinder Morgan raised around $2.86 billion earlier this month in the largest U.S. energy-related IPO since 1998, upping the size and price of its offering after strong demand.

Fundraising activity has been buoyed by relatively strong stock markets, with world equities, measured by the MSCI All-Country World Index, hitting 2-1/2 year highs this month despite unrest in North Africa.

The $24.3 billion raised globally since the start of January is a 20 percent increase on the same period last year, the data showed. Secondary offerings have also seen a boost, up 23 percent year-on-year to raise $67.7 billion globally.

With several big listings — including a $3.7 billion offering from U.S. hospital operator HCA Holdings and a $2.4 billion IPO by Denmark’s ISS — currently in the works, and a huge pipeline of deals still to launch, the market shows no signs of slowing.

In particular, Europe is braced for a flurry of stock market listings in the next two months as firms use annual results as launching pads for share sales and hope to complete deals before investors disappear for the Easter break.

BRIC boom underpins best M&A start since 2007

Reuters — Merger and acquisition activity has seen the strongest start to a year since 2007 with $473 billion in deals completed so far, up 63 percent from the same period a year ago, Thomson Reuters data shows.

Deals targeting companies in the dominant emerging economies of Brazil, Russia, India and China accounted for $53 billion, up 58 percent compared to the same period last year and their most active start on record.

Thomson Reuters’ Investment Banking Weekly Scorecard noted that the largest M&A deal for the week was BP’s $9 billion acquisition of a 30 percent stake in India’s Reliance Industries.

BRIC-targeted M&A comprised about 11 percent of the total activity so far in 2011 while European targets made up 23.5 percent. The United States accounted for the majority at 61 percent.

The financial sector was the most active, accounting for 23 percent of total deals, followed by the energy and power sectors as well as materials.

Year-to-date total global debt issuance slipped 2 percent from the same period in 2010 to $950.9 billion but equity issuance rose 20 percent for the period to $101.5 billion.

This was the best start to global initial public offerings on record with $24.3 billion raised.

The largest IPO so far this year was U.S. pipeline company Kinder Morgan’s listing in New York this month, which raised $3.3 billion.

Syndicate loan volumes rose 16 percent from the same period last year, with $172.9 billion raised so far in 2011.