IPO Watch Europe Q1 2016

Transcription

1 IPO Watch Europe Q bn IPO proceeds raised in Q1 1 down 79% from the 1.4bn raised in Q1 50 IPOs in Q1 1 across Europe, down from 82 IPOs in Q1 135m average offering value in Q1 1, a decrease of 50% compared to 27m in Q1

2 2 IPO Watch Europe Q1 1

3 Contents European IPO trends 4 Market volatility Pricing and performance 7 The sector story 8 focus Overview 9 Relative performance of IPOs PE trends and the sector story 11 Global perspective 12 Appendix 13 Contacts 1 Stay tuned This quarter has proven to be challenging for IPO activity but that s not to say we don t see a diverse pipeline for the end of 1 and early 17. We expect that candidates in the financial sector, mainland European privatisations and strategic demergers will contribute their fair share to overall annual proceeds. But with the EU referendum looming, uncertainties still remain, and we do not expect to reach the bn mark before the summer break and this reflects a return to the levels seen in the first half of 13, before the recent boom of the last two years. Mark Hughes Partner, UK Capital Markets Leader at PwC IPO Watch Europe Q1 1 3

4 European IPO trends remained the leading exchange in a quarter with incredibly subdued IPO activity across the whole of Europe Figure 1: Quarterly European IPO activity by value and volume Q1 Q2 Q3 Q4 Q1 1 Less than $5m raised Greater than $5m raised Total number of listings ,375 14,724 4, 21,73 3,490 Exercised greenshoe ( m) 1, , Total money raised ( m) 17,989,8 4,884 23,258 3, Total European listings comprise those with: Money raised excl. greenshoe ( m) Average offering value ( m)* * Average offering value has been calculated based on total money raised including greenshoe, excluding listings raising less than $5m retained its leading position, but was not spared from the general IPO market maladies and experienced a 50% drop in activity, from already subdued levels last year. The exchange accounted for circa twothirds of total European proceeds and was the second largest exchange globally in terms of IPO proceeds. Figure 2: Top 3 stock exchanges in Europe in Q1 1 (by offering value) 18 IPOs raised * OMX 2.3bn 14 IPOs raised * Average IPO proceeds ** 0.8bn 177m Average IPO proceeds ** Largest IPO: 118m CYBG Largest IPO: 521m ( 453m excl. greenshoe) Scandinavian Tobacco 480m ( 477m excl. greenshoe) *Excludes greenshoe **Average proceeds has been calculated on total proceeds including greenshoe, excluding listings raising less than $5m 4 IPO Watch Europe Q1 1 Deutsche Börse 3 IPOs raised * 0.3bn Average IPO proceeds ** 144m Largest IPO: Senvion 25m (no greenshoe)

5 European IPO trends IPO proceeds down by 79% compared to Q1 and 84% compared to Q4, after two consecutive years of buoyant IPO activity Figure 3: Q1 European IPO activity since 07* Value of IPOs ( bn) Volume of IPOs Q1 07 Q1 08 Q1 09 Q1 Q1 11 Q1 12 Q1 13 Q1 14 Q1 Q1 1 Proceeds IPOs Figure 4: Quarterly European IPO activity since Value of IPOs ( bn) Volume of IPOs Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q Value bn Greenshoe bn 1 IPOs *Excludes greenshoe. Note: Excludes IPOs on Borsa Istanbul, Zagreb Stock Exchange and Bucharest Stock Exchange pre 11 IPO Watch Europe Q1 1 5

6 Market volatility 1 started with tumbling indices, bottoming oil prices and spiking volatility Figure 5: Volatility compared to IPO proceeds IPO of Deutsche Pfandbriefbank, Euskaltel and Flow Traders 1bn+ IPOs of Worldpay, Poste Italiane, Covestro and Scout24 1bn+ IPOs of Amundi and ABN AMRO VSTOXX index Money raised bn 14 1bn+ IPOs of Sunrise, Aena and GrandVision Falling oil prices, Chinese economy slowdown and threat of impending bear market China stock market turmoil Jan Feb Mar Apr Money raised bn May Jun Jul Aug Sep Oct Nov Dec Jan Feb 1 Mar VSTOXX index Figure : Historical performance of major market indices since January % change since 1 Jan 40% 30% % % DAX 30 CAC 40 0% FTSE 0 % % Jan Jan Feb FebMar Mar Apr Apr May MayJun Jun Jul Jul Aug Aug Sep Sep Oct Oct Nov Nov Dec Dec Jan Jan FebFeb Mar Mar Source: Thomson Reuters as at 31 Mar 1 IPO Watch Europe Q1 1 1

7 Pricing and performance of top 5 IPOs The top 5 IPOs have priced towards the lower end or even below their initial price range, reflecting the tough market conditions Figure 7: Top 5 IPOs in Q1 1 CYBG Metro Bank * Scandinavian Tobacco Countryside Properties Ascential Exchange OMX IPO date 8 February 7 March February 17 February 12 February Price range Fixed price initially DKR93.00 DKR Offer price DKR Money raised ( m) incl. greenshoe The start to 1 was a little like a game of musical statues, as the IPO market opened in fits and starts. You needed to have nerves of steel to try and execute an IPO this quarter as market volatility hampered timetables and pricing expectations. Cash rich private equity houses and corporates continued to fuel record levels of M&A activity and we saw a number of IPO candidates chose the trade sale route rather than join the public markets. Even as markets anxiety recedes, I would expect the trend of companies progressing down a dual track process to continue as, while more onerous for companies, this increases the chance of a deal completing. Viv Maclachlan Director in the UK Capital Markets Group at PwC Figure 8: Offer price versus initial price range of top 5 IPOs Figure 9: Performance of top 5 IPOs 30%.8%.0% 14.2% % 11.4% % 5.% 5.2% 5.8% 4.4% Offer price 0% % 0.7% %.0% 30% CYBG Metro Bank Scandinavian Tobacco Countryside Ascential Properties CYBG Metro Bank Scandinavian Countryside Tobacco Properties Ascential Share performance from IPO to 31 Mar 1 (%) Offer price Price range Domestic index performance from IPO to 31 Mar 1 (%) Note: Metro Bank private placement conditional upon listing IPO Watch Europe Q1 1 7

8 The sector story continued to dominate in a subdued quarter where all sectors have been relatively depressed Figure : IPO value by sector* By offering value ( m) Q1 Q2 Q3 Q4 Q1 1 Variance vs Q1 2,402 4,479 3,21,403 1,323 (1,079) Consumer Goods 1, , (259) Consumer Services 3,138 1, (2,587) (1) Industrials 5,427 2, , (5,195) Health Care 1, (1,0) Technology ,334 4 (18) , () 1,887 2, (1,887) Utilities Basic Materials Telecommunications Oil & Gas Total (18) 1,375 14,724 4, 21,73 3,490 (12,885) Consumer Goods Consumer services IPOs raised in Q1 1 4 IPO raised in 4 IPOs raised in 1.3bn * 0.9bn * 0.bn * Average IPO proceeds ** Average IPO proceeds ** Average IPO proceeds ** 198m 311m 197m Largest IPO: Largest IPO: Largest IPO: CYBG Scandinavian Tobacco Ascential 521m ( 453m excl. greenshoe) 480m ( 477m excl. greenshoe) 390m ( 34m excl. greenshoe) *Excludes greenshoe ** Average proceeds has been calculated on total proceeds including greenshoe, excluding listings raising less than $5m 8 IPO Watch Europe Q1 1

9 focus Overview Main Market IPO proceeds and numbers fell this quarter, but AIM remained the bright spot with activity and proceeds increasing Figure 11: IPO trends (by offering value) * bn.7bn Figure 12: IPO trends (by volume) Q Q bn Volume of IPOs Value of IPOs ( bn) bn Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q Main and SFM AIM Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q Main and SFM AIM Figure 13: Top 5 UK IPOs in Q1 1 Proceeds ( m) Issuer Metro Bank plc CYBG plc Countryside Properties plc Ascential plc CMC Markets plc Excl. greenshoe Incl. greenshoe Sector Consumer Goods Consumer Services Market Main Main Main Main Main PE backed Yes No Yes Yes No Note: Ranking in pounds is different from ranking in euros due to exchange rate Despite challenging market conditions, companies with strong equity stories and good management teams have successfully completed their IPOs. AIM has been a bright spot this quarter, with increased activity seen across a range of sectors, but as with the wider IPO market until there is more macroeconomic certainty and until we know the outcome of the EU referendum, it is difficult to predict when IPO activity levels will pick up again. The pipeline of companies preparing for IPOs towards the end of 1 and into 17 looks generally healthy, but as the IPO window begins to close as we get closer to the EU referendum and traditional summer hiatus, we expect that there will be increased volatility where people won't want to price IPOs. Lucy Tarleton Director in the UK Capital Markets Group at PwC *Excludes greenshoe Source: Stock Exchange IPO Watch Europe Q1 1 9

10 focus Relative performance of IPOs Recent IPOs have had a mixed performance this quarter Figure 14: Share price performance of IPOs relative to the FTSE all share index, from IPO to 31 March 1 (%) 30% % % 0% % % 30% 40% 50% 0% 70% Falcon Acquisitions 4 Blue Prism Group 51 Cerillion Technologies 28 MaxCyte Yu Group Harwood Wealth Management Group Shield Therapeutics davictus CYBG Ascential Watkin Jones Countryside Properties companies have outperformed the index 7 companies have underperformed the index Circle Property 4 RockRose Energy 7 Metro Bank 7 CMC Markets 8 Cogenpower Trendit 17 Main and SFM AIM Note: Relative performance based on the FTSE All Share Index for Main Market and SFM listed companies and FTSE AIM All Share index for AIM quoted companies Source: Dealogic and Thomson Reuters as of 31 March 1 IPO Watch Europe Q1 1

11 focus PE trends and the sector story PEbacked IPOs continued to represent more than 50% of UK IPO activity Figure : Value of PEbacked IPOs vs non PEbacked IPOs in * 8 Figure 1: Volume of PEbacked IPOs vs non PEbacked IPOs in * 30 74% 4% 5 93% 53% 4 98% % 25 59% 82% 0% 1 58% Volume of IPOs Value of IPOs ( bn) 7 33% 89% 50% 70% 33% 5 4% 53% 79% 54% 84% 43% 75% 50% 50% 0% 50% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q PEbacked Non PEbacked Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q PEbacked Non PEbacked Figure 17: IPO value by sector * By offering value ( m) Consumer Goods Consumer Services Q1 Q2 Q3 1,08 2,11 Q4 38 Q Variance vs. Q1 983 (85) , (1,707) , (144) Health Care Technology Industrials Utilities Basic Materials Telecommunications Oil & Gas Total value ( m) () 3,37 3,4 53 4,578 1,787 (1,581) * UK IPOs raising over $50m, excludes closedend funds, SPACs, SPVs, Capital Pool companies, Investment Managers, REITs, Royalty Trusts Source: Dealogic, Bloomberg IPO Watch Europe Q1 1 11

12 Global perspective This year has been the slowest start to the year since 09 with global IPO proceeds at 12.5bn in Q1 1 Figure 18: Global IPO activity * Volume of IPOs Value of IPOs ( bn) Q1 Q2 Q3 Q4 13 Q1 Q2 Q3 Q4 Q1 Q2 14 EMEA ( bn) Q3 Q4 1 Americas ( bn) Asia Pacific ( bn) Q1 IPOs Figure 19: Top global IPOs in Q1 1 Issuer China Zheshang Bank Co m (incl. greenshoe) Exchange Sector Deal type 1,531 Hong Kong Bank of Tianjin Co 870 Hong Kong LaSalle Logiport REIT 835 Tokyo CYBG 521 Carveout Metro Bank 518 PEbacked Scandinavian Tobacco Group 480 OMX Copenhagen Consumer Goods Silver Run Acquisition 41 Nasdaq Countryside Properties 449 Consumer Goods Middle East Healthcare 431 Saudi Arabia Health Care Ascential 390 Consumer Services * Excludes greenshoe Source: Dealogic 12 IPO Watch Europe Q1 1 PEbacked PEbacked

13 Appendix IPOs by market Appendix 1: European IPOs by market Q1 Q2 Q3 Q4 02 Q1 1 Value ( m)* Stock exchange IPOs IPOs IPOs IPOs IPOs TOTAL Stock Exchange 27 4, , , ,327 NASDAQ OMX 18 1, , , Deutsche Börse , , Borsa Italiana , Warsaw Borsa Istanbul Euronext 13 2, , , BME (Spanish Exchange) 3 4,3 5 2, SIX Swiss Exchange 1 1, Oslo Børs & Oslo Axess Irish Stock Exchange Zagreb Stock Exchange 2 3 Sofia 1 Prague 1 Bucharest Wiener Börse 1 Total 82 1, , , 5 21, ,490 EUREGULATED Main and SFM 18 4, , , ,02 NASDAQ OMX (Main) 1, , , Deutsche Börse (Prime and General Standard) , , Warsaw (Main) SIX Swiss Exchange 1 1, Euronext 9 2, , ,79 Borsa Italiana (Main) ,091 Oslo Børs Sofia 1 BME (Spanish Exchange) (Main) 2 4,3 3 2, Prague 1 Irish Stock Exchange (Main) Wiener Börse 1 Zagreb Stock Exchange 2 3 EUregulated subtotal 45, , , , ,923 EXCHANGEREGULATED AIM NASDAQ OMX (First North) Borsa Italiana (AIM) Borsa Istanbul BME (Spanish Exchange) (MAB) Euronext (Alternext) Warsaw (NewConnect) Deutsche Börse (Entry Standard) Bucharest (AeRO) Oslo Axess 3 58 Exchangeregulated subtotal Europe total 82 1, , , 5 21, ,490 Value ( m)* Value ( m)* Value ( m)* Value ( m)* * Excludes greenshoe IPO Watch Europe Q1 1 13

14 Appendix Exchange activity by value Appendix 2: IPO offering value by stock exchange* Stock exchange offering value ( m) Stock Exchange NASDAQ OMX OMX Copenhagen OMX Stockholm OMX Helsinki OMX Vilnius OMX Iceland OMX Talinn Deutsche Börse Borsa Italiana Warsaw Borsa Istanbul Euronext Euronext Paris Euronext Amsterdam Euronext Brussels Euronext Lisbon BME (Spanish Exchange) SIX Swiss Exchange Oslo Børs & Oslo Axess Sofia Irish Stock Exchange Zagreb Stock Exchange Bucharest Stock Exchange Wiener Börse Prague Stock Exchange Total *Excludes greenshoe 14 IPO Watch Europe Q1 1 Q1 4,48 1, , , ,9 32 4,3 1, ,375 Q2 4,97 2,447 2, ,27 1, , ,724 Q , , Q4,278 1,951 1, ,955 3, ,70 1,748 3, ,73 Q1 1 2, ,490

15 Appendix Exchange activity by volume Appendix 3: IPO volume by stock exchange Stock exchange offering volume Q1 Q2 Q3 Q4 Q1 1 Stock Exchange NASDAQ OMX OMX Copenhagen OMX Stockholm OMX Helsinki OMX Vilnius 1 1 OMX Iceland 2 1 OMX Talinn 1 Deutsche Börse Borsa Italiana Warsaw Borsa Istanbul Euronext Euronext Paris Euronext Amsterdam Euronext Brussels Euronext Lisbon BME (Spanish Exchange) SIX Swiss Exchange Oslo Børs & Oslo Axess Sofia 1 Irish Stock Exchange 1 1 Zagreb Stock Exchange 2 Bucharest Stock Exchange Wiener Börse 1 Prague Stock Exchange 1 Total IPO Watch Europe Q1 1

16 Contacts About IPO Watch Europe IPO Watch Europe surveys all new primary market equity IPOs on Europe s principal stock markets and market segments (including exchanges in Austria, Belgium, Croatia, Czech Republic, Denmark, France, Germany, Greece, the Netherlands, Ireland, Italy, Luxembourg, Norway, Poland, Portugal, Romania, Spain, Sweden, Switzerland, Turkey and the UK) on a quarterly basis. Movements between markets on the same exchange are excluded. This survey was conducted between 1 January and 31 March 1 and captures IPOs based on their first trading date. All market data is sourced from the stock markets themselves and has not been independently verified by PricewaterhouseCoopers LLP. Katherine Howbrook (Press office) +44 (0) katherine.j.howbrook@uk.pwc.com Mark Hughes +44 (0) mark.c.hughes@uk.pwc.com Vivienne Maclachlan +44 (0) vivienne.maclachlan@uk.pwc.com Lucy Tarleton +44 (0) lucy.c.tarleton@uk.pwc.com This publication has been prepared for general guidance on matters of interest only, and does not constitute professional advice. You should not act upon the information contained in this publication without obtaining specific professional advice. No representation or warranty (express or implied) is given as to the accuracy or completeness of the information contained in this publication, and, to the extent permitted by law, PricewaterhouseCoopers LLP, its members, employees and agents do not accept or assume any liability, responsibility or duty of care for any consequences of you or anyone else acting, or refraining to act, in reliance on the information contained in this publication or for any decision based on it. 1 PricewaterhouseCoopers LLP. All rights reserved. In this document, PwC refers to PricewaterhouseCoopers LLP which is a member firm of PricewaterhouseCoopers International Limited, each member firm of which is a separate legal entity. 1 IPO Watch Europe Q1 1