Global IPO Market Review

 |  Includes: CG, FB, GWRE, PRLB, TOYS, YELP
by: Renaissance Capital IPO Research

Thus far, 2012 has proven to be an exciting year for IPOs. At only eleven weeks into the year, the global IPO market has raised more than $4 Billion and IPO performance has been strong in 2012 as evidenced by the FTSE Renaissance Global IPO Index (IPOSG) which has outperformed major global equity benchmarks with a 14.2% return year-to-date. Strangely however, foreign IPOs have basically been absent in 2012. Of the 31 global IPOs this year, just 6 listed outside of US borders.

2012 Global IPOs - Year to Date
Region Number

of IPOs

Avg. Return

from Offer

Proceeds Raised


% of Proceeds
North America 25 19.5% $2,615 65.1%
Asia Pacific 4 1.9% $1,062 26.4%
Europe 2 32.0% $341 8.5%
Grand Total 31 18.0% $4,018 100.0%
Click to enlarge

The Americas There is no disputing that the United States has been the star of the global IPO Market so far this year, accounting for 65% of global proceeds raised. With 25 domestic IPOs completed year to date, the US IPO market is currently on pace to top the 125 US deals completed in 2011. IPO Performance in the US has also improved this year as the US IPO Index has displayed strong outperformance with a year-to-date return of +17.4%. The US has held some notable offerings this year, including business reviews website Yelp (NYSE:YELP), enterprise software provider Guidewire Software (NYSE:GWRE), cloud-based video platform BrightCove (BCOV, +51.5%), and prototyping parts provider ProtoLabs (NYSE:PRLB). With a pipeline packed with major companies set to go public this year, including Facebook (NASDAQ:FB), The Carlyle Group (CG), and Toys 'R' Us (TOYS), the United States may be in for its busiest year since 2007.

On a more somber note, the United States is the only country in the Americas region that has shown IPO activity so far this year as Latin American companies continue to struggle with a lack of investor demand. It is worth mentioning however, that issuance in Latin America is expected to pick up in the coming months, which is largely attributable to recent news that Latin America's largest independent investment bank BTG Pactual (BTGP.RC) plans to hold an initial public offering of its own during the second quarter.

Asia Pacific

Asia Pacific has experienced a slow start, with only four offerings accounting for 26% of total global proceeds raised so far this year. However, a slow start is a fairly common occurrence in the Asia Pacific Region. Despite finishing last year with 57 deals and raising over $34 billion in total proceeds, during the first two months of 2011 the Asia Pacific region only held five offerings. Therefore, the region's sluggish beginning to the year is not an indicator of a disappointing 2012.

Hong Kong has led issuance in this region with two IPOs raising nearly $750 million in total proceeds. Interestingly, the most newsworthy IPO in this region has been from India. In the country's first IPO since August of 2011, the Multi-Commodity Exchange (MCX.IN) listed shares on the National Stock Exchange of India and was greeted with a warm investor welcome. MCX is currently up +25.3% from its offer price.

Europe, Middle East, and Africa

The EMEA region has struggled with low issuance so far this year, having raised only $341 million this year (8% of total global proceeds), as the effects of the European Debt Crisis continue to take their toll on the region. However, London-listed oil and gas company RusPetro (RPO.LN, +49.6%) and French semiconductor manufacturer Inside Secure (INSD.FP, +14.5%) have both performed very well. That said, earlier this month, Dutch cable TV operator Ziggo BV (ZIGGO.NA) and Swiss business support services provider DKSH Holdings (DKSH.SW) each filed to raise $810 million and $844 million, respectively. If either of these two deals price, they would be the biggest European offering since Banca Civica's (BCIV.SM) initial public offering in July of 2011. Companies in the EMEA region are hoping for these two deals to serve as a catalyst to inspire more investor interest, as the region's pipeline is loaded with IPO-ready companies waiting for stable economic conditions.