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Quarterly IPOs Rise for the First Time Since 4Q07

NEW YORK: Initial public offerings in the United States rose between the first and second quarters of this year, marketing the first quarterly uptick since the final three months of 2007. PricewaterhouseCoopers said there were 12 IPOs that raised $1.6 billion in 2Q, compared to just two in the first quarter that raised $722 million. Activity still remained down from a year ago (2Q08), when 18 IPOs generated $5.1 billion.

“A few select companies were able to take advantage of the capital markets which started to improve in late March,” said Scott Gehsmann, a capital markets partner in the PricewaterhouseCoopers Transaction Services practice. “As we move toward the later part of the year, we will see more companies testing the IPO waters.”

Global IPO activity also grew slightly in 2Q, though it was still down from a year ago. A total of 28 companies were taken public in Europe, raising $800 million. During 2Q08, 133 offerings raised $18.3 billion. The four largest IPOs during the quarter comprised 88 percent of the total amount of money raised. Hong Kong saw 18 IPOs that raised $2.2 billion in the first half of 2009, a 66 percent drop in value from the same period in 2008. Brazil logged the largest IPO in Latin America with a $4.3 billion outing by Visanet, also the largest offering worldwide for the first half of 2009.

For the first six months of 2009, there were 14 U.S. IPOs that raised $2.3 billion, compared 43 offerings raising $27.7 billion for the same period in 2008. During 2Q08, Visa achieved the largest U.S. IPO in history, valued at $ 17.9 billion. The largest IPO in the first half of 2009 was the $720 million raised Mead Johnson Nutrition Co.

The New York Stock Exchange continued to lead in 2009 IPO volume, with 11 IPOs raising $2 billion in proceeds, or 88 percent of the total proceeds raised during the first six months of 2009.

“Stronger second quarter IPO activity bodes well for the second half of the year,” Gehsmann said. “A number of companies have already begun to assess their IPO-readiness in preparation for the inevitable return of the IPO market.”
-- Deborah D. McAdams