The global market for initial public offerings is starting to thaw after being placed in a deep freeze during April and May, when companies put plans for new listings on ice at the height of the coronavirus pandemic.
This brought down overall IPO activity for the first half of the year, with volumes and proceeds falling by 19% and 8%, respectively, compared with the same period a year earlier.Paul Go, EY Global IPO Leader, said that although IPO activity declined in April and May 2020 because of lockdowns in most markets that closed the economy, there has been a strong rebound in June.
U.S. exchanges still accounted for the majority of IPOs in the Americas in the first half of 2020, accounting for 79% of total deal volume with 64 deals, and 91% of proceeds with $22.3bn raised as a string of companies braved the equity markets.On June 26, Lemonade, LMND, the insurance startup backed by SoftBank Group SFT, announced that it was looking to raise up to $286 million in its U.S. IPO with a price range of $23 to $26.
Not all IPOs are going as planned. The same day Lemonade listed, Albertsons Companies ACI, +0.77% priced its offering below expectations at $16 a share, according to The Wall Street Journal, in a sign of weak investor demand. The U.S. supermarket operator raised $800 million through the sale of 50 million shares as its private equity owner Cerberus Capital Management moved to cash out of its investment.
However, the continent is also starting to show signs of life. Coffee group JDE Peet’s, which owns the Peet’s coffee brand in the U.S., raised €2.25 billion in its Amsterdam listing on May 29, in Europe’s largest IPO since 2018.The second largest IPO this year took place in Milan, after the Italian filter maker GVS GVS, +0.39% raised €497 million on June 19, sending its shares up by almost 20% on its first day of trading.
“Green Shoots” eh?
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