Buyouts to Produce Big IPOs in 2007; Global IPOs Surpass $250B in 2006
In 2006, US regained the No.1 status from Europe as the world's most active private equity market, with $403 billion of announced deals, three times that of 2005.
IPO seem to be most logical exit for the multi-billion dollar private equity buyout deals like Freescale Semiconductor Inc., HCA Inc., and Equity Office Properties Trust:
In 2006, private-equity-backed IPO deals outperformed their private counterparts, with the average first day close of private-equity-sponsored IPOs in 2006 at 12%, compared with 10% for all other types, according to data from Dealogic.
In 2006, there were a half-dozen companies that raised more than $1 billion each through IPOs, up from just one such offering in 2005;
Half of last year's six megadeals were private-equity-backed.
Meanwhile, the value of companies taken private reached record levels in 2006, with New York and London's stock markets taking the brunt of the $150 billion of de-equitisation, according to figures from Thomson Financial, reports FT.com. The New York Stock Exchange saw a net withdrawal of listed capital of $38.8 billion, while Nasdaq suffered a net withdrawal of $11 billion.
Initial public offerings of US companies at $41 billion were less than half the nearly $97 billion of so-called public-to-privates where listed companies are bought out by private equity investors.
Global IPO value topped $253 billion by late December in 2006, companies in China and Russia responsible for $65 billion worth of IPOs, according to Thomson Financial research.