IPO Watch Europe Q2 2015

Transcription

1 IPO Watch Europe Q bn IPO proceeds raised in Q2 201 (excl. greenshoe) 31.1bn in H1 201 and 33.7bn in H IPOs Listed in Q IPOs in H1 201 and 214 IPOs in H m Average offering value for Q m for H1 201 and 223m for H

2 Outlook for second half 201: Following the Greek No vote, global markets have showed increasing signs of tension albeit without wide-spread panic. We believe July will be key in assessing the extent of the contagion risk and receptiveness of Europe s markets to the pipeline of IPO candidates. Barring these factors, the trends observed in the first part of 201 will continue and we expect continued IPO activity in the second part of the year: - PE driven activity will continue, though at a slower pace as IPO exits compete with trade sales - A number of spin-offs from large listed companies have already been announced, especially in the financial sector - Privatisation programmes will also contribute sizable IPOs throughout Europe, including Italy, Netherlands and Poland There are other headwinds likely to impact Europe s markets with volatility likely to be a recurring feature of the coming months, due to the uncertainty on US interest rates and the renewed concerns over the Chinese economy. Contents European IPO trends 3 Market volatility and performance Pricing and performance of top European IPOs 6 Top 10 IPOs in Europe 7 Exchange activity by value Exchange activity by volume 9 IPOs by sector 10 UK focus Overview 11 Relative performance of London IPOs 12 Private equity and industry trends 13 US and Hong Kong domestic activity 14 Appendix IPOs by market 1 Contacts / About IPO Watch Europe 16 2

3 European IPO trends 14.7bn raised in Q2 201, down 34% on Q following the surge in activity across Europe last year Figure 1: Quarterly European IPO activity by value and volume H Q1 201 Q2 201 H1 201 Total European listings comprise those with: Less than $m raised Greater than $m raised Total number of listings Money raised excl. greenshoe ( m) 33,730 16,37 14,724 31,099 Exercised greenshoe ( m) 2,17 1, ,310 Total money raised ( m) 3,7 17, ,409 Average offering value ( m)* * Average offering value has been calculated based on total offering value including greenshoe excluding listings raising less than $m We enter a period of uncertainty following the Greek referendum and wider concerns in the US and China may give rise to market turbulence and volatility. In this environment, a number of IPO plans may be derailed or postponed and in the short term we expect the summer holiday months to be relatively quiet. The pipeline for the second half of the year looks solid and we expect IPO activity to pick up towards the end of the third quarter. Mark Hughes Partner in the UK Capital Markets Group 3

4 European IPO trends Strong activity levels in both quarters resulted in a good H1 201, slightly below H but far ahead of the five previous years Figure 2: European IPO activity (H1 and full year) since 2007* Value of IPOs ( bn) H Volume of IPOs H1 value bn FY value bn IPOs *Excludes greenshoe. Note: Excludes IPOs on Borsa Istanbul, Zagreb Stock Exchange and Bucharest Stock exchange pre 2011 Figure 3: Quarterly European IPO activity since Value of IPOs ( bn) ,4 0, 0,4 7,7 3,3,4 3,0 14, 11,4 22,3 6,6 9,2 16,4 14,7 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q Volume of IPOs Value bn Greenshoe bn IPOs 4

5 Market volatility and performance Volatility index has increased significantly towards the end of the quarter reflecting increasing uncertainty over Greece Figure 4: Volatility compared to IPO proceeds 16 IPO of ISS, Pets at Home and Poundland IPO of AA, B&M and Euronext IPO of NN, FinecoBank and SSP IPO of Sunrise, Aena, Elis and GrandVision Money raised bn Turmoil in emerging markets Declining oil price QE by ECB Greece uncertainty 20 1 VSTOXX index Jan Feb Mar Apr May Jun July Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Money raised bn VSTOXX index 0 Figure : Historical performance of major market indices since January % % change since 1 Jan % 20% 10% 0% DAX 30 CAC 40 FTSE % янв фев мар апр май июн июл авг сен окт ноя дек янв фев мар апр май июн Source: Thomson Reuters as at 30 June 201

6 Pricing and performance of top European IPOs The top IPOs have all outperformed their respective indices Figure 6: Top five IPOs in Q2 201 Cellnex Telecom Woodford Patient Capital Trust Spie Europcar INWIT Exchange BME London Euronext Paris Euronext Paris Borsa Italiana IPO date 7 May 21 April 9 June 26 May 22 June PE backed No No Yes Yes No Money raised ( m) incl. greenshoe 2,141 1, Price range Figure 7: Offer price versus initial price range of top five IPOs Figure : Performance of top five IPOs 30% 13,% 11,0% 20%,4%,2% 10% Offer price 0% -1,4% -10% -3,% -1,4% -1,1% -20% -6,2% -6,4% Cellnex Telecom Woodford Patient Capital Trust Spie Europcar INWIT Cellnex Telecom Woodford Patient Capital Trust Spie Europcar INWIT Offer price Price range Share performance from IPO to 30 Jun 201 (%) Domestic index performance from IPO to 30 Jun 201 (%) 6

7 Top 10 IPOs in Europe Spain hosted the largest IPO in both quarters so far in 201 Figure 12: Top ten IPOs (value) in Q % % Top 10 IPOs Other The weather is warm and the window is certainly open in Madrid. A strong start to the year with the Aena IPO has been quickly followed up in Q2, with Cellnex and Patentes Talgo standing out in terms of capital raised, with Euskatel successfully completing its IPO on 1 July. Entering the traditionally quieter summer period, we reflect upon what has been a fantastic year to date for the Spanish IPO market, far surpassing 2014 total proceeds already. With the improving economic indicators, we are hopeful of more positive news to follow for 201, but also note the elections in November are likely to result in a slower end to the year. Rocio Fernandez Funcia Partner in the Spanish Capital Markets Group Figure 13: Top ten IPOs Ten largest IPOs in Q2 201 m (excl. greenshoe) m (incl. greenshoe) Sector Market Country of origin Cellnex Telecom 1,946 2,141 Telecommunications BME Spain No Woodford Patient Capital Trust 1,10 1,10 Financials London United Kingdom No Spie Industrials Euronext France Yes Europcar Groupe Consumer Services Euronext France Yes INWIT Telecommunications Borsa Italiana Italy No Pandox Financials OMX Sweden No Patentes Talgo Industrials BME Spain Yes Sophos Group Technology London United Kingdom Yes Cairn Homes Consumer Goods London Ireland No Europris Consumer Services Oslo Norway Yes Total,16,641 PE backed Ten largest IPOs in Q1 201 m (excl. greenshoe) m (incl. greenshoe) Sector Market Country of origin PE backed Aena 3,7 4,263 Industrials BME Spain No Auto Trader 1,937 2,22 Consumer Services London United Kingdom Yes Sunrise Communications 1,2 2,14 Telecommunications SIX Swiss Switzerland Yes GrandVision 1,020 1,116 Health Care Euronext Netherlands Yes Elis 70 4 Industrials Euronext France Yes Refresco Gerber 4 63 Consumer Goods Euronext Netherlands Yes Tele Columbus Technology Deutsche Börse Germany No OVS Consumer Goods Borsa Italiana Italy Yes Saeta Yield Utilities BME Spain No Wizz Air Holdings Consumer Services London Hungary Yes Total 11,702 12,99 7

8 Exchange activity by value London retained its leading position in H1 201, however proceeds in Spain almost doubled compared to H Figure 9: IPO offering value by stock exchange* Stock exchange offering value ( m) H Q1 201 Q2 201 H1 201 London Stock Exchange 1,67 4,64 4,697 9,34 BME (Spanish Exchange) 3,631 4,310 2,93 6,903 Euronext 6,70 2,637 2,267 4,904 Euronext Paris 4, ,999 2,90 Euronext Amsterdam 1,767 1,696-1,696 Euronext Brussels Euronext Lisbon NASDAQ OMX 3,279 1,416 2,447 3,63 OMX Stockholm 1,714 1,040 2,26 3,30 OMX Helsinki OMX Copenhagen 1, OMX Iceland OMX Vilnius OMX Talinn SIX Swiss Exchange 1,073 1,2-1,2 Borsa Italiana 1, ,43 Deutsche Börse ,301 Oslo Børs & Oslo Axess Irish Stock Exchange Warsaw Stock Exchange Zagreb Stock Exchange Borsa Istanbul Bucharest Stock Exchange Wiener Börse Prague Stock Exchange Total 33,730 16,37 14,724 31,099 Figure 10: Top five stock exchanges in Europe in Q2 201 LSE 2 IPOs raised * 4.7bn Average IPO proceeds ** 200m Largest IPO: Woodford Patient Capital Trust 1,10m (no greenshoe exercised) BME IPOs raised * 2.6bn Average IPO proceeds ** 712m Largest IPO: Cellnex Telecom 1,946m ( 2,141m incl. greenshoe) OMX 37 IPOs raised * 2.4bn Average IPO proceeds ** 121m Largest IPO: Pandox 601m ( 691m incl. greenshoe) Euronext 13 IPO raised * 2.3bn Average IPO proceeds ** 239m Spie 939m ( 1,033m incl. greenshoe) Borsa Italiana 7 IPOs raised * 1.0bn Average IPO proceeds ** 16m Largest IPO: INWIT 796m (no greenshoe exercised) *Excludes greenshoe **Excludes listings raising less than $m

9 Exchange activity by volume OMX saw more activity in Q2 201 than the whole of H1 2014, representing over a quarter of all European Q2 IPOs by volume Figure 11: IPO volume by stock exchange Stock exchange offering volume H Q1 201 Q2 201 H1 201 London Stock Exchange NASDAQ OMX OMX Stockholm OMX Helsinki OMX Iceland OMX Vilnius OMX Talinn OMX Copenhagen Euronext Euronext Paris Euronext Brussels Euronext Amsterdam Euronext Lisbon Warsaw Stock Exchange Borsa Italiana Deutsche Börse BME (Spanish Exchange) 6 3 Oslo Børs & Oslo Axess Borsa Istanbul Bucharest Stock Exchange SIX Swiss Exchange Irish Stock Exchange Zagreb Stock Exchange Wiener Börse Prague Stock Exchange Total After a few quiet years, a positive trend of IPOs on the Italian Stock Exchange began in mid 2014 and has continued through the first half of 201. The ECB liquidity injection has improved the performance of the Italian equity markets, reducing volatility and improving conditions for companies entering the capital markets for the first time. There is a robust pipeline of Italian corporate and public service entities seeking out an IPO, most of which are monitoring the developments in Greece in order to plan the right time to approach the markets. Christian Alessandrini Partner in the Italian Capital Markets Group 9

10 IPOs by sector Financials and Consumer services declined significantly compared to H1 2014, partially offset by growth in Telecom, Industrials and Consumer goods Figure 14: IPO value by sector* Stock exchange offering value ( m) H Q1 201 Q2 201 H1 201 variance vs. H Industrials 7,112,427 2,967,394 1,22 Financials 9,976 2,402 4,40 6,2 (3,094) Consumer Services 10,0 3,13 1,99,136 (4,92) Telecommunications 2,160 1,7 2,743 4,630 2,470 Consumer Goods 96 1, ,03 1,097 Health Care 1,096 1, ,961 6 Technology ,2 63 Utilities Oil & Gas (747) Basic Materials (2) Total 33,730 16,37 14,724 31,099 (2,631) The second quarter has been good for French IPOs, especially PE-backed ones. All transactions raising more $0m were PE backed over the period, reflecting the renewed confidence in economic conditions in France. Investors are also keen to support innovation with healthcare being the most dynamic industry by number of IPOs. The pipeline remains good, although the uncertainty related to European and international geopolitics might hinder the potential level of activity in the coming months. Philippe Kubisa Partner in the French Capital Markets Group Financials 36 IPOs raised in Q2 4,40m * Average IPO proceeds ** 172m Largest IPO: Woodford Patient Capital Trust 1,10m ( 1,10m incl. greenshoe) Industrials 23 IPOs raised in Q2 2,967m * Average IPO proceeds ** 197m Largest IPO: Spie 939m ( 1,033m incl. greenshoe) Telecom 3 IPOs raised in Q2 2,743m * Average IPO proceeds ** 1,371m Largest IPO: Cellnex Telecom 1,946m ( 2,141m incl. greenshoe) *Excludes greenshoe **Excludes listings raising less than $m 10

11 UK focus Overview A decrease in average deal size combined with an uptick in trade sales led to lower activity in London compared to the buoyant activity in Q Figure 1: London IPO trends value* Figure 16: London IPO trends - volume Value of IPOs ( bn) , 1,2 1,3 0,1 0,4 1, , ,0 0, , ,1 0,9 0,1 0,0 3,6 1, 2,3 1,1 7,0 4,6 9,2 1,3 0, 4, 3, , ,2 1 - Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q Main AIM and SFM Main AIM and SFM *Excludes greenshoe Volume of IPOs Figure 17: Five largest UK IPOs of Q2 201 Proceeds (incl. greenshoe) m m Sector Market Country PE backed Woodford Patient Capital Trust 1,10 00 Financials Main United Kingdom No Sophos Group Technology Main United Kingdom Yes Cairn Homes Consumer Goods Main Ireland No Toro Financials Main United Kingdom No Apax Global Alpha Financials Main United Kingdom Yes After leading the PE-backed trend for the last two years, US PE driven IPOs started to slow down six months ago and we are seeing a similar trend emerge in the UK. In stark contrast, PE exits across continental Europe remain active - whether this continues into the second half of the year remains to be seen due to the continued uncertainty over Greece. Viv Maclachlan Director in the UK Capital Markets Group 11

12 UK focus - Relative performance of London IPOs Figure 1: Share price performance of London IPOs relative to the FTSE all share index, from IPO to 30 Jun 201 Aldermore Group Stride Gaming Drum Income Plus REIT Wizz Air Integrated Diagnostics Sanne Group Auto Trader Shawbrook Group Eurocell RedX Pharma Woodford Patient Capital Trust Curtis Banks Marshall Motor Holdings John Laing Group Lakehouse Miton UK MicroCap Trust Cairn Homes Elegant Hotels Group DFS Furniture Grand Group Investment Ranger Direct Lending Fund Sequoia Economic Infrastructure Income Fund PureTech Health Amedeo Air Four Plus Apax Global Alpha AEW UK REIT Gateley Holdings Verseon Sophos Group Toro Non-Standard Finance Gabelli Value Plus+ Trust VPC Speciality Lending Investments Revolution Bars Group PTSG Zegona Communications MayAir Group Gear4music Adgorithms Puma VCT 11 ScS Group HSS Hire Group Aquatic Foods Group IronRidge Resources -0% -60% -40% -20% 0% 20% 40% 60% 0% companies have outperformed the index companies have underperformed the index Main Market AIM and SFM Note: Threshold of $m proceeds Relative performance based on the FTSE All Share Index for Main Market and SFM listed companies and FTSE AIM All Share index for AIM listed companies Source: Dealogic and Thomson Reuters as of 30 June

13 UK focus - Private equity and industry trends Figure 19: PE-backed vs non PE-backed IPO trends in London* Value of IPOs ( bn) % 49% 1% 96% - 7% 2% 70% 100% 6% 4% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q Non PE-backed PE-backed Figure 20: Five largest UK PE-backed IPOs of Q2 201 Proceeds (incl. greenshoe) m m Sector Market Country Sophos Group Technology London United Kingdom Shawbrook Group Financials London United Kingdom Integrated Diagnostics Health Care London Egypt Apax Global Alpha Financials London United Kingdom Elegant Hotels Group 7 63 Industrials London Barbados Figure 21: London IPO value by sector ** Stock exchange offering value ( m) H Q1 201 Q2 201 H1 201 Financials 4,23 1,466 2,977 4,443 Consumer Services,24 2, ,6 Industrials 1, Consumer Goods Technology Health Care Consumer Services Telecommunications Oil & Gas Utilities Total 1,67 4,64 4,697 9,34 We are now almost two years into the resurgence of PE-driven IPO activity and the backlog of IPO candidates is now naturally slowing. For some time we have seen a large number of these transactions being run as dual track processes and, as we see private and public valuations converge, trade sales become quite attractive, as essentially they provide a one-time exit to existing shareholders. James Fillingham Deals Partner * UK IPOs raising over $0m, excludes closed-end funds, SPACs, SPVs, Capital Pool companies, Investment Managers, REITs, Royalty Trusts ** Excludes greenshoe 13

14 US and Hong Kong domestic activity The US IPO market was reinvigorated in the second quarter after a slow start to 201 Hong Kong more than doubled H1 201 proceeds compared to last year Figure 22: US and Hong Kong overview H Q1 201 Q2 201 H1 201 Stock exchange IPOs Offering value ( m)* IPOs Offering value ( m)* IPOs Offering value ( m)* IPOs Offering value ( m)* Europe , , , ,099 US ,64 41, , ,16 Hong Kong 2 7, , , ,174 * Excludes greenshoe The US IPO market came back to life in the second quarter of 201, increasing 3 percent in volume and 111 percent in proceeds raised, compared to the first quarter of 201 which had been a record low. 7 IPOs completed in Q2 201 raising 11.bn, a significant increase over the first quarter s 41 IPOs and.4bn in proceeds, despite slowing economic growth forecasts in the US and the uncertain interest rate environment. The healthcare industry continued to lead IPO market activity with 31 IPOs (41 % of total volume) - the high demand for these smaller biotechnology and biopharmaceutical IPOs showcases the interest among IPO investors for high-growth companies. On a total proceeds basis, Q2 was generally well-diversified, with the energy sector raising the highest proceeds as energy prices slowly show signs of recovery. Companies continue to crystalize valuations through spin-off transactions to help create improved corporate clarity and visibility. There were 9 spin-offs that closed in the second quarter of 201. This brought the total number of completed spin-offs for the year to 14, which already exceeds the total spin-offs in 2012 and is on track to surpass the 1 spin-offs in In Hong Kong, the second quarter took off after a slow start of the year with 46 IPOs raising 1.1bn, compared to 2.1bn in Q Overall, the half year results more than doubled compared to last year, with 17.2bn raised in H1 201 against 7.6bn in H The new Shenzhen-Hong Kong Stock Connect program, along with the existing Shanghai-Hong Kong Stock Connect program have fuelled the positive IPO trend and define new growth opportunities and perspectives for companies and investors, reflected in the strong results of this first half-year. 14

15 Appendix - IPOs by market Figure 23: IPOs by market H Q1 201 Q2 201 H1 201 Offering value ( m)* Offering value ( m)* Offering value ( m)* Offering value ( m)* Stock exchange IPOs IPOs IPOs IPOs TOTAL London Stock Exchange 6 1, ,64 2 4,697 9,34 BME (Spanish Exchange) 6 3, ,310 2,93 6,903 Euronext 2 6, , , ,904 NASDAQ OMX 33 3, , ,447 3,63 SIX Swiss Exchange 1, , ,2 Borsa Italiana 12 1, ,43 Deutsche Börse ,301 Oslo Børs & Oslo Axess Irish Stock Exchange Warsaw Stock Exchange Zagreb Stock Exchange Borsa Istanbul Bucharest Stock Exchange Wiener Börse Prague Stock Exchange Athens Stock Exchange Budapest Stock Exchange Total , , , ,099 EU-REGULATED London Main 40 13, , ,6 32,214 BME (Spanish Exchange) (Main) 3, , , 6,9 Euronext 20 6,23 9 2,7 9 2,20 1 4,37 NASDAQ OMX (Main) 11 2,97 6 1, , ,234 SIX Swiss Exchange 1, , ,2 Borsa Italiana (Main) 2 1, ,392 Deutsche Börse (Prime and General Standard) ,301 Oslo Børs Irish Stock Exchange (Main) Warsaw Stock Exchange (Main) Zagreb Stock Exchange Wiener Börse Prague Stock Exchange Bucharest Stock Exchange Athens Stock Exchange Budapest Stock Exchange EU-regulated sub-total , , , ,032 EXCHANGE-REGULATED London AIM and SFM 46 2, , ,131 NASDAQ OMX (First North) Oslo Axess Borsa Italiana (AIM) Euronext (Alternext) Borsa Istanbul Warsaw Stock Exchange (NewConnect) BME (Spanish Exchange) (MAB) Bucharest Stock Exchange (AeRO) Deutsche Börse (Entry Standard) Irish Stock Exchange (ESM) Exchange-regulated sub-total 113 2, , ,067 Europe total , , , ,099 * Excludes greenshoe 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, 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 April and 30 June 201 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. 201 PricewaterhouseCoopers. All rights reserved PwC helps organisations and individuals create the value they re looking for. We re a network of firms in 17 countries with more than 19,000 people who are committed to delivering quality in assurance, tax and advisory services. Find out more by visiting us at 16