IPO Market Builds Momentum; 27 New Offerings in Q1 as Issuers Regain Confidence, According to PricewaterhouseCoopers

NEW YORK, April 14 /PRNewswire/ -- Issuers are showing renewed confidence in the U.S. IPO market according to the PricewaterhouseCoopers' (PwC) IPO Watch, a quarterly analysis of IPOs on U.S. stock exchanges. PwC forecasts that growth in the IPO market that began in the second half of 2009 is expected to continue through the remainder of 2010.

First quarter 2010 U.S. IPO deal activity represented a significant increase over the same period last year.  There were 27 deals completed in Q1, which raised $4.1 billion, compared with two deals that raised $0.7 billion in Q1 2009.  In Q1 2008, there were 25 deals completed that raised $22.6 billion, including the $17.9 billion Visa IPO.

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"The first quarter is typically a relatively slow period for IPOs," said Scott Gehsmann, a capital markets partner with PricewaterhouseCoopers' Transaction Services practice.  "A strong first quarter is a promising sign for continuing momentum through 2010, and while some issuers have experienced challenges around pricing and readiness, reasonably priced deals from issuers who prepare diligently have been successful."

(Photo:  http://www.newscom.com/cgi-bin/prnh/20100414/NY85913-b )

Financial sponsors, led by private equity firms, contributed more than half the deals and proceeds raised with 18 completed offerings totalling $2.8 billion in Q1.  "Financial sponsor-backed IPOs are driving much of the growth in the pipeline," continued Gehsmann.  The largest IPO in the quarter, Sensata Technologies, was a financial sponsor-backed issuer which raised $569 million in March.

First quarter IPO activity showed a healthy diversification of deals across a wide array of industry sectors.  Financial Services contributed seven deals that raised $1.2 billion, slightly outpacing the Industrial Products sector which saw four deals that raised $943 million.  The Technology and Healthcare sectors also had four deals each, raising approximately $400 million and $323 million, respectively.  "The diversity of industry sectors contributing to the increasing deal flow is a validation of the recovery of the US IPO market," observed Gehsmann.

In terms of listing destination, NYSE led the proceeds with 73% of total offering value in the first quarter, with 16 completed offerings for a total value of $3.0 billion.  There were 11 NASDAQ-listed IPOs which raised $1.1 billion.

Non-US issuers completed eight IPOs raising $1.3 billion in the first quarter. Non-US issuers continued to be active in the US market with China being the most active with five IPOs.

Similar to the US, international markets also saw growth in IPO activity in the first quarter of 2010 compared to the first quarter of 2009. European markets saw 77 IPOs that raised $6.5 billion in the first quarter of 2010 compared to only 16 IPOs that raised $46 million in the first quarter of 2009.

PricewaterhouseCoopers' U.S. IPO Watch is a quarterly survey of all IPOs listed on U.S. exchanges.  These include IPOs by domestic and foreign companies, best-efforts, business development companies, filings with the FDIC, and bank demutualizations.  IPOs do not include unit investment trusts and fully classified closed-end funds.  Visit our website, www.pwc.com/ustransactionservices, for our 2006, 2007, 2008 and 2009 U.S. IPO Watch reports.

PricewaterhouseCoopers' Transaction Services

The PricewaterhouseCoopers Transaction Services practice provides due diligence for M&A transactions, along with advice on M&A strategy and integration, restructuring, divestitures and separation, valuations, accounting, financial reporting, and capital raising. With approximately 1,000 deal professionals in 16 cities in the United States, and a global network of over 6,000 deal professionals in 90 countries, experienced teams are deployed with deep industry and local market knowledge and technical experience tailored to each client's situation. The Transaction Services team can be involved from strategy to integration and employ an integrated business approach to uncover the realities of a deal. The field-proven, globally consistent, controlled deal process helps clients minimize their risks, progress with the right deals, and capture value both at the deal table and after the deal closes. For more information about M&A and related PricewaterhouseCoopers services, please visit www.pwc.com/ustransactionservices.

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SOURCE PricewaterhouseCoopers