Once again, when it comes to the new issuance market, the Ipreo Blog may have spoken too soon.
Merely a month after crowing about 2017’s strong kickoff (especially in the face of 2016’s mutli-week drought to start the year), February’s short month has put a quick stop to that kind of talk.
Only five IPOs priced in February, for an aggregate total of $630.7M in proceeds, falling short of January’s nine for total proceeds of $4.3B. After four straight weeks of activity, including a first half of February in which four of the month’s five debuts landed, there wasn’t a single debut from the 12th through the 27th. The Financials sector Hamilton Lane offering provided some last minute relief from the drought on the 28th.
Hamilton Lane was also the month’s largest IPO, its $190M in proceeds edging out Foundation Building Materials Inc.’s $179.2M out of the Consumer Services sector. Despite those two debuts, it’s the Energy sector that’s raising the most eyebrows, its four IPOs so far in 2017 a big change from last year, when Energy didn’t have a single IPO land until July.
Looking ahead to March, we’ve already had one big splash, as Snap Inc.’s highly anticipated $3.4B IPO made its debut yesterday. The company behind social media sensation Snapchat landed with the largest Tech IPO since Facebook’s $16.0B debut hit in May 2012, and largest IPO in general since Citizens Financial Group, Inc.’s $3.5B offering in September 2014.
Snap aside, the 6-month backlog currently has 19 issuers looking to raise $2.1B, compared to the prior-year period’s backlog of 49 issuers for $12.5B. Without the big Tech IPO, JBS Foods International B.V moves to pole position as the largest issuer in the backlog ($500.0M). By sector, Tech/Telecom currently leads with six issuers in the backlog, while Industrials trails with five issuers.
March is off to a hot start – came in like a lion, as it were – but we’ve already been reminded by February’s second-half swoon that that may not necessarily be an indication of momentum.
As always, the Ipreo Blog will keep you posted as the year progresses.