2010 IPOs to exceed US$300bln

Surpassing the 2007 record of US$295 billion, total global IPO proceeds for this year are backed by Asian issuers raising the most capital.

According to Ernst & Young’s Year-end Global IPO Update, IPOs worldwide have already raised US$255.3 billion in 1,199 deals in the first 11 months of 2010, with Asian issuers making up 64% of the total global IPO value so far. Asian issuers have already raised US$164.5 billion, followed by North American issuers raising US$40 billion in 168 deals. European issuers, on the other hand, have so far raised US$32.8 billion in 211 IPOs and the Middle East & Africa US$5 billion in 47 IPOs.

Max Loh, Assurance Partner and Singapore IPO Leader, Ernst & Young LLP said, “Benefiting from relatively low interest rates in developed markets and abundant liquidity, global investors in the last 11 months have been avidly seeking exposure to the growth in Asia and other emerging markets. This trend is expected to continue.”

In terms of sectors, Ernst & Young said the top three which accounted for 63% of total value were financials (US$74.9 billion), industrials (US$52.7 billion) and materials (US$34.8 billion). Loh explained, “Asian insurance companies and banks drove global IPO markets, while the high level of activity by industrial and materials companies reflects the focus by emerging market governments on modernisation of their infrastructure.”

In Singapore, Loh noted that the trend of foreign listings on the local exchange looks to continue with increasing interest from companies in the region beyond Chinese companies. Overall, the expectation for 2011 is a continuing upward trend.