The first half of 2017 has seen a rebound in overall IPO activity, compared to the same period last year. Baker McKenzie’s Cross-Border IPO Index shows that the value of issuance globally rose to USD 89 billion and the number of deals to 728 (an increase of 76% and 53%, respectively, from H1 2016).
However, deal making has not reached the same levels as in 2015, as total capital raised in H1 2017 was 24% lower. Still, there is a sense that companies the world over are getting on with business despite recent political developments.
“Markets have performed well, with key indices rising to record levels. Political stability in many markets, strong performance of IPOs and sound economic fundamentals are the forces driving investor demand, while investors have also learned to live with unpredictable political developments,” said Koen Vanhaerents, head of capital markets at Baker McKenzie.
This uptick in activity is also evident in the technology sector. So far, 2017 has seen a good start for tech IPOs with 103 companies taking to the markets and raising USD 12.1 billion. This is in stark contrast to the whole of 2016, when only USD 10.7 billion was raised from 123 issuances. The speed at which technology is evolving and demand for greater application across different industries have ensured more investment overall.
“The pace of technological change in particular in big data, payments and HealthTech is driving stronger activity. Market platforms as a business model are getting a strong foothold and there is a renewed sense of opportunity in the industry as well as a need to grow to survive and a willingness to invest for the longer term,” said Anne-Marie Allgrove, global chair of IT/C at Baker McKenzie.
The latest edition of Baker McKenzie’s Cross-Border IPO Index also features analysis of private equity/venture capital-backed IPOs, which made up 35% of total IPO value for H1 2017.