AsiaPac IPOs raise a disappointing US$609m in 3Q11

This is an 18% decline from 2Q11’s US$3.3b.

North America still dominates as Europe and Asia stutter
Although the global IPO market has recently been dominated by Asia, Nasdaq and New York Stock Exchange remain issuers’ favorite IPO destination for PE backed companies. In Q3, the US led with nine deals valued at US$2b (84% decrease in capital raised compared to Q2).

Bunder continues: “IPOs which managed to launch in Q3 faced stiff headwinds as they worked to establish themselves in the secondary market. Despite this, strong performance from a number of new issues kept average post listing performance essentially flat for Q3 deals – globally, PE-backed deals declined only 0.6% relative to listing value on a weighted average basis.”

Issuers in the Asia-Pacific region executed ten IPOs in Q3, down modestly from the 12 that went public in the second quarter. Deal sizes however, were markedly lower, with companies raising just US$609m in aggregate, down from US$3.3b in Q2. The largest deal out of the region was by CITIC-backed Beijing Jangho Curtain Wall Company, which raised US$340.2m on the Shanghai exchange. The offering priced at the high end of its expected range, and closed out its first day of trading up 39.4%, despite a loss of 1.6% on the Shanghai composite index.

Luke Pais, Partner, Transaction Advisory Services, Ernst & Young Solutions LLP, says: “Many very good PE-backed companies are still waiting to exit. As soon as the market stabilizes, expect to see an increase in the number of PE-backed IPO listings. Until then, PE firms are actively monitoring alternative exit channels, including sales to strategics and other PE investors, as the industry searches for liquidity.