2014 IPO Market Is The Strongest In 2 Years


This year is off to a booming start in initial public offerings. EY Global IPO Trends found that in the first quarter of this year alone, there have already been 239 IPOs in markets around the globe. Those deals raised approximately $44.3 billion and continued the momentum which began in the end of 2013.

Best January for IPOs in more than a decade

The firm states that the first quarter of this year saw the number of deals rise 47% year over year. In addition, the amount of capital which was raised through IPOs rose 82%, which means this was the most active first quarter since 2011. January was especially strong, as 11 OPOs raised $18.5 billion during the month. That’s the largest amount raised in the first month of the year for more than 10 years.

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EY Global IPO Trends believes this strength will continue at least throughout the first half of this year.

Asia, China lead in IPO activity

The firm found that Asia was on top in terms of the numbers of deals and also the value of the capital raise. It cited one of the main reasons for this as being the reopening of exchanges in mainland China. Asia saw a total of 103 IPOs which raised a total of $16.9 billion.

Exchanges on the continent made up 43% of the world’s IPO activity according to the number of deals and 38% of the amount of capital which was raised. Mainland China alone saw 44 new public listings of companies which raised a collective $5.3 billion. Seven of the largest IPOs in the world were in Asia, including HK Electric Investments Ltd (HKG:2638), which listed in January and raised $3.1 billion, making it the largest IPO of the year so far.

PE, VC lead first quarter IPOs

In the U.S. and Europe, the firm said private equity and venture capital were the main drivers of IPOs. It said both forms of funding were leaders in the market around the globe as well. EY Global said that together, private equity and venture capital drove 33% of global deals. The U.S. reported 72% of sponsor-backed IPOs, while the Europe, Middle East, India and Africa region reported 26% of them.

Within the U.S., the New York Stock Exchange ranked first in terms of the amount of capital raised. The NASDAQ was fifth on the list. The two exchanges raised a collective $11.6 billion through 68 deals during the first quarter. In the U.S. alone, IPO activity more than doubled year over year, rising 106%. U.S.-based companies made up for 84% of the world’s total offerings.

U.S. exchanges are also still attracting IPOs from companies outside the country. During the quarter there were 11 foreign listings which raised a collective $1.9 billion. That made up 16% of the IPOs held in the U.S. during the quarter. Several billion-dollar deals are still expected this year, including JD.com and Alibaba, according to EY Global.