Stay current on changes and developments in corporate law with a wide variety of resources and tools.
By Yin Wilczek
Oct. 12 — The U.S. initial public offering market recovered somewhat in the third quarter, bolstered by issuances from LINE Corp., Valvoline Inc. and others, but the amount of funds raised this year is still the lowest compared to the same periods over the last five years.
According to Bloomberg Law data, 101 IPOs priced in the first three quarters of the year, an 87 percent increase over the 54 that priced in the first two quarters. The total value of the IPOs for the three quarters was $17.3 billion, about a 90 percent increase from the $9.1 billion for the first two quarters.
Latham & Watkins LLP is the top law firm in terms of overall IPO count so far in 2016. The firm represented eight issuers this year, and served as counsel for 13 underwriters.
Deal attorneys say the recent strong performance may help persuade companies hoping to go public to do so in 2017.
“Obviously it was a strong September and it’s been a strong start to October” for IPOs, Cathy Birkeland, global co-chair of Latham & Watkins’ capital markets practice, told Bloomberg BNA. There also are a number of deals in the pipeline for the rest of the year, she said. “This bodes well for the IPO market in 2017.”
Highlights for the third quarter include the issuance from Japanese message services provider LINE Corp. The IPO traded 26.7 percent above its offer price on the first day of trading and raised almost $895 million. The company said it plans to use the funds to bankroll acquisitions of content and technology.
Meanwhile, the IPO from Lexington, Ky.-based automotive lubricant manufacturer Valvoline priced within its offer range to raise $759 million. Also noteworthy is the offering from San Jose, Calif.-based software company Nutanix Inc. In late September, Nutanix's IPO traded 131.25 percent above its offer price on the first day of trading and raised almost $238 million.
In terms of industries, the Bloomberg Law data showed that the pharmaceutical industry had the most IPOs for the year, followed by the biotechnology industry. However, pharma IPOs have seen a steady decline in dollar value since 2013.
Life sciences issuers have led in the IPO space because there's just been an “explosion of technology,” Charlie Kim, global co-head of Cooley LLP's capital markets practice, told Bloomberg BNA. “It's been an exciting time for breakthrough technology and potential treatments.”
Kim said he is planning to get more technology deals done starting in the first quarter of next year. “Hopefully, we'll see more technology companies go out in 2017 than we have in the last couple of years,” he said.
According to Bloomberg Law data, Cooley is the top law firm for IPOs so far this year in the areas of biotechnology (five offerings), pharmaceuticals (six) and software (four).
To contact the reporter on this story: Yin Wilczek in Washington at firstname.lastname@example.org
To contact the editor responsible for this story: Susan Jenkins at email@example.com
Bloomberg Law IPO data is available to subscribers at https://www.bloomberglaw.com/product/corptrans/secondary_page/ct_ipo_market_update.
Copyright © 2016 The Bureau of National Affairs, Inc. All Rights Reserved.
All Bloomberg BNA treatises are available on standing order, which ensures you will always receive the most current edition of the book or supplement of the title you have ordered from Bloomberg BNA’s book division. As soon as a new supplement or edition is published (usually annually) for a title you’ve previously purchased and requested to be placed on standing order, we’ll ship it to you to review for 30 days without any obligation. During this period, you can either (a) honor the invoice and receive a 5% discount (in addition to any other discounts you may qualify for) off the then-current price of the update, plus shipping and handling or (b) return the book(s), in which case, your invoice will be cancelled upon receipt of the book(s). Call us for a prepaid UPS label for your return. It’s as simple and easy as that. Most importantly, standing orders mean you will never have to worry about the timeliness of the information you’re relying on. And, you may discontinue standing orders at any time by contacting us at 1.800.960.1220 or by sending an email to firstname.lastname@example.org.
Put me on standing order at a 5% discount off list price of all future updates, in addition to any other discounts I may quality for. (Returnable within 30 days.)
Notify me when updates are available (No standing order will be created).
This Bloomberg BNA report is available on standing order, which ensures you will all receive the latest edition. This report is updated annually and we will send you the latest edition once it has been published. By signing up for standing order you will never have to worry about the timeliness of the information you need. And, you may discontinue standing orders at any time by contacting us at 1.800.372.1033, option 5, or by sending us an email to email@example.com.
Put me on standing order
Notify me when new releases are available (no standing order will be created)