Bankers cautious on outlook
Bankers cautious on outlook

Bankers cautious on outlook

Global equity raising fell by more than a quarter in 2016, data showed last week, hit by geopolitical shocks and a string of failed initial public offerings (IPOs), with the outlook for 2017 looking shaky.
Estelle de Bruyn
Companies raised US$648.9 billion in equity during 2016, against US$873 billion last year, Thomson Reuters Equity Capital Markets (ECM) data up to Dec. 28 showed.

Money raised from IPOs was down by almost a third at US$130.6 billion despite equity indices touching record highs in the latter stages of the year.

“The markets were volatile­ this year. There were times when IPOs got launched but didn't get done, and there were also fewer rights offer­ings,” said Achintya Mangla, head of ECM in Europe, Middle East and Africa (EMEA) at JP Morgan, which topped the league table for global equity offer­ings and IPOs.

“2017 will continue to be uncertain and volatile and I'd expect IPO volumes will be in line with this year.”

Mangla added that, though he does not expect IPO activity to rise, there could be higher overall ECM volumes with a potential increase in rights issues and acquisition-related financing.

The year's biggest IPO, for Postal Savings Bank of China in September, was priced at the lower end of an indicative range and traded flat before falling more than 10 percent.

Share price falls follow­ing two big European­ IPOs – payments company Nets and energy business Innogy – put investors on edge, resulting in bankers being unable to drum up sufficient support for a string of other listings in the final quarter of 2016.

Market volatility was blamed for some of the canceled listings, which normally require a window of at least four weeks to complete. In Europe, IPOs more than halved in volume terms compared with 2015.

That could continue in 2017, with elections in France, Germany and the Netherlands, as well as Britain formally trigger­ing the process of leaving the European Union, expected to limit the number of suitable windows to launch IPOs.



WAITING IN THE WINGS

However, preparations­ are underway for a number of big deals that could help to lift ECM activity in the coming year.

Telefonica has hired UBS, Morgan Stanley and Barclays as global coordinators to list its British mobile business O2, which could fetch about 10 billion pounds (US$12.2 billion).

A planned IPO of Siemens' healthcare subsidiary and a capital raising by Bayer to finance the acquisition of Monsanto could also be big-ticket deals.

Italy's UniCredit, mean­while, plans to raise 13 billion euros (US$13.6 billion) in the country's biggest share issue to shore up its balance sheet and shield itself from a broader banking crisis.

Credit Suisse aims to list its domestic operation to raise a sum that could reach as high as 4 billion Swiss francs (US$3.9 billion) and Deutsche Bank is said to be exploring­ options to beef up its capital.

There is also the potential that messaging app Snapchat's decision to file for an IPO could persuade­ other technology businesses to head for public markets.

“Tech companies have been able to achieve very attractive valuations in the private markets, but some of the heat has come out of the private funding arena and the IPO route is looking more attractive,” said Tom Johnson, Barclays' co-head of equity capital markets in EMEA.

“If a few large tech company IPOs go well in the United States, we would hope to see more here, too.”

However, some bankers cautioned against taking investors' apparent rotation toward equities and away from fixed income as a guarantee for easy share issues.

“It might look like a bull market, but investors will still be selec­tive,” Johnson said.

“Market performance has been mixed this year so there is some caution and valuations have to reflect that.” -Nampa/Reuters

Kommentaar

Republikein 2024-03-28

Geen kommentaar is op hierdie artikel gelaat nie

Meld asseblief aan om kommentaar te lewer

Katima Mulilo: 19° | 37° Rundu: 17° | 33° Eenhana: 18° | 33° Oshakati: 20° | 31° Ruacana: 19° | 33° Tsumeb: 17° | 29° Otjiwarongo: 16° | 28° Omaruru: 18° | 31° Windhoek: 17° | 28° Gobabis: 17° | 28° Henties Bay: 16° | 19° Wind speed: 24km/h, Wind direction: S, Low tide: 10:54, High tide: 04:57, Low Tide: 22:58, High tide: 17:16 Swakopmund: 15° | 17° Wind speed: 29km/h, Wind direction: SW, Low tide: 10:52, High tide: 04:55, Low Tide: 22:56, High tide: 17:14 Walvis Bay: 16° | 22° Wind speed: 33km/h, Wind direction: SW, Low tide: 10:52, High tide: 04:54, Low Tide: 22:56, High tide: 17:13 Rehoboth: 18° | 29° Mariental: 22° | 32° Keetmanshoop: 21° | 34° Aranos: 21° | 31° Lüderitz: 15° | 29° Ariamsvlei: 23° | 34° Oranjemund: 15° | 21° Luanda: 27° | 30° Gaborone: 20° | 32° Lubumbashi: 17° | 24° Mbabane: 15° | 23° Maseru: 12° | 28° Antananarivo: 16° | 27° Lilongwe: 17° | 29° Maputo: 20° | 28° Windhoek: 17° | 28° Cape Town: 17° | 23° Durban: 21° | 25° Johannesburg: 18° | 28° Dar es Salaam: 26° | 32° Lusaka: 18° | 30° Harare: 15° | 31° Currency: GBP to NAD 24 | EUR to NAD 20.57 | CNY to NAD 2.64 | USD to NAD 19.1 | DZD to NAD 0.14 | AOA to NAD 0.02 | BWP to NAD 1.33 | EGP to NAD 0.39 | KES to NAD 0.14 | NGN to NAD 0.01 | ZMW to NAD 0.74 | ZWL to NAD 0.04 | BRL to NAD 3.8 | RUB to NAD 0.2 | INR to NAD 0.23 | USD to DZD 134.49 | USD to AOA 832.63 | USD to BWP 13.71 | USD to EGP 47.29 | USD to KES 131.48 | USD to NGN 1415.13 | USD to ZAR 19.1 | USD to ZMW 24.97 | USD to ZWL 321 | Stock Exchange: JSE All Share Index 73909.5 Up +0.41% | Namibian Stock Exchange (NSX) Overall Index 1516.02 Down -0.13% | Casablanca Stock Exchange (CSE) MASI 12981.98 Up +0.34% | Egyptian Exchange (EGX) 30 Index 28224.37 Down -2.87% | Botswana Stock Exchange (BSE) DCI Same 0 | NSX: MTC 7.75 SAME | Anirep 8.99 SAME | Capricorn Investment group 17.34 SAME | FirstRand Namibia Ltd 49 DOWN 0.50% | Letshego Holdings (Namibia) Ltd 4.1 UP 2.50% | Namibia Asset Management Ltd 0.7 SAME | Namibia Breweries Ltd 31.49 UP 0.03% | Nictus Holdings - Nam 2.22 SAME | Oryx Properties Ltd 12.1 UP 1.70% | Paratus Namibia Holdings 11.99 SAME | SBN Holdings 8.45 SAME | Trustco Group Holdings Ltd 0.48 SAME | B2Gold Corporation 47.34 DOWN 1.50% | Local Index closed 677.62 UP 0.12% | Overall Index closed 1534.6 DOWN 0.05% | Osino Resources Corp 19.47 DOWN 2.41% | Commodities: Gold US$ 2 196.10/OZ UP +0.24% | Copper US$ 3.97/lb DOWN -0.0031 | Zinc US$ 2 439.40/T DOWN -0.7% | Brent Crude Oil US$ 86.36/BBP DOWN -0.0003 | Platinum US$ 892.91/OZ DOWN -0.0022 Sport results: Weather: Katima Mulilo: 19° | 37° Rundu: 17° | 33° Eenhana: 18° | 33° Oshakati: 20° | 31° Ruacana: 19° | 33° Tsumeb: 17° | 29° Otjiwarongo: 16° | 28° Omaruru: 18° | 31° Windhoek: 17° | 28° Gobabis: 17° | 28° Henties Bay: 16° | 19° Wind speed: 24km/h, Wind direction: S, Low tide: 10:54, High tide: 04:57, Low Tide: 22:58, High tide: 17:16 Swakopmund: 15° | 17° Wind speed: 29km/h, Wind direction: SW, Low tide: 10:52, High tide: 04:55, Low Tide: 22:56, High tide: 17:14 Walvis Bay: 16° | 22° Wind speed: 33km/h, Wind direction: SW, Low tide: 10:52, High tide: 04:54, Low Tide: 22:56, High tide: 17:13 Rehoboth: 18° | 29° Mariental: 22° | 32° Keetmanshoop: 21° | 34° Aranos: 21° | 31° Lüderitz: 15° | 29° Ariamsvlei: 23° | 34° Oranjemund: 15° | 21° Luanda: 27° | 30° Gaborone: 20° | 32° Lubumbashi: 17° | 24° Mbabane: 15° | 23° Maseru: 12° | 28° Antananarivo: 16° | 27° Lilongwe: 17° | 29° Maputo: 20° | 28° Windhoek: 17° | 28° Cape Town: 17° | 23° Durban: 21° | 25° Johannesburg: 18° | 28° Dar es Salaam: 26° | 32° Lusaka: 18° | 30° Harare: 15° | 31° Economic Indicators: Currency: GBP to NAD 24 | EUR to NAD 20.57 | CNY to NAD 2.64 | USD to NAD 19.1 | DZD to NAD 0.14 | AOA to NAD 0.02 | BWP to NAD 1.33 | EGP to NAD 0.39 | KES to NAD 0.14 | NGN to NAD 0.01 | ZMW to NAD 0.74 | ZWL to NAD 0.04 | BRL to NAD 3.8 | RUB to NAD 0.2 | INR to NAD 0.23 | USD to DZD 134.49 | USD to AOA 832.63 | USD to BWP 13.71 | USD to EGP 47.29 | USD to KES 131.48 | USD to NGN 1415.13 | USD to ZAR 19.1 | USD to ZMW 24.97 | USD to ZWL 321 | Stock Exchange: JSE All Share Index 73909.5 Up +0.41% | Namibian Stock Exchange (NSX) Overall Index 1516.02 Down -0.13% | Casablanca Stock Exchange (CSE) MASI 12981.98 Up +0.34% | Egyptian Exchange (EGX) 30 Index 28224.37 Down -2.87% | Botswana Stock Exchange (BSE) DCI Same 0 | NSX: MTC 7.75 SAME | Anirep 8.99 SAME | Capricorn Investment group 17.34 SAME | FirstRand Namibia Ltd 49 DOWN 0.50% | Letshego Holdings (Namibia) Ltd 4.1 UP 2.50% | Namibia Asset Management Ltd 0.7 SAME | Namibia Breweries Ltd 31.49 UP 0.03% | Nictus Holdings - Nam 2.22 SAME | Oryx Properties Ltd 12.1 UP 1.70% | Paratus Namibia Holdings 11.99 SAME | SBN Holdings 8.45 SAME | Trustco Group Holdings Ltd 0.48 SAME | B2Gold Corporation 47.34 DOWN 1.50% | Local Index closed 677.62 UP 0.12% | Overall Index closed 1534.6 DOWN 0.05% | Osino Resources Corp 19.47 DOWN 2.41% | Commodities: Gold US$ 2 196.10/OZ UP +0.24% | Copper US$ 3.97/lb DOWN -0.0031 | Zinc US$ 2 439.40/T DOWN -0.7% | Brent Crude Oil US$ 86.36/BBP DOWN -0.0003 | Platinum US$ 892.91/OZ DOWN -0.0022