The market for initial public offerings in the U.S. hit a high this year not seen since the tech bubble burst in the early 2000s, with more than 222 IPOs expected before the end of 2013.
The 6 offerings priced Dec. 11 brought the annual IPO total to 218, beating the post-bubble peak of 217 reached in 2004 and eclipsing the most recent high of 213 in 2007, according to Renaissance Capital.
The value of the deals is up too, breaching the $50 billion mark for the 1st time since 2000. The 218 deals launched thus far in 2013 have drummed up some $53.5 billion from investors, according to the IPO investment firm.
And there are still 4 more deals slated for this year, though there’s no guarantee that they’ll come off. Although the federal shutdown in October didn’t wind up having as much of an impact on the IPO market as initially feared, several companies, including CardioDx and Vital Therapies, wound up spiking their offerings due to the proverbial "unfavorable market conditions."
According to an Ernst & Young report, there were 51 healthcare IPOs in North America as of Dec. 2, compared with just 13 in all of 2012. The total healthcare IPO raise for the region was $8.82 billion this year, compared with $890 million last year, according to the EY report. In the U.S. the projected 222 IPOs are pegged to raise some $59.6 billion; the 133 U.S. IPOs launched last year raised $46.7 billion, according to EY, for increases of 67% and 28%, respectively. The U.S. market this year accounted for 26% of all deals and 37% of capital raised worldwide, according to the report.
"IPO activity in the US in 2013 proves to be the most active since 2004 and this strong momentum will continue in 2014. We expect to see increasing number of PE- and VC backed IPOs. Elsewhere in the Americas, 2013 IPO activity in Central and South America has surpassed 2012 by deal volume and capital raised, active countries include Brazil and Mexico," said Jackie Kelley, EY’s Americas IPO leader.
Globally, the IPO count for healthcare this year was 90 deals worth a collective $10.8 billion, compared with 56 deals worth $6.08 billion in 2012, the consulting firm reported.
"2013 marks the end of a 2-year decline in IPO activity. The improving macro-economic backdrop, easing global monetary conditions, reduced political uncertainty and rising investor confidence in key markets saw the IPO year end on a high that exceeded expectations," EY global vice-chair of strategic growth markets Maria Pinelli said in prepared remarks. "We expect 2014 to be a record year, with economic fundamentals and strong global liquidity fuelling new listings. The pace will be set in the 1st quarter – we anticipate that total proceeds for Q1’14 could be in the range of $35 billion to $45 billion, on a global volume of 250-300 deals. The forecast would re-set IPO activity on par with 2005-2008 1st-quarter levels."