Overall IPO activity rebounded in H1 2017 compared to the same period last year as economic fundamentals in major developed markets such as the EU and US stabilized and some political uncertainties settled.
This is according to our latest Cross-Border IPO Index, which shows that the value of issuance rose by 76% to USD 89 billion and volume increased to 728 deals, up 53% from the first half of last year. As we predicted last June, domestic deals outpaced cross-border IPOs in H1 this year, rising 93% in value compared to a 41% increase in cross-border deal values. The greater popularity of domestic issuance was largely driven by the comfort of home markets and the protection against currency volatility provided by listing in companies' functional currencies.
That said, deal making has not quite returned to the levels of 2015 - total capital raised being 24% lower in the first half of 2017.
Average deal size globally (domestic and cross-border combined), has increased by 15% to USD 122 million. However the first half of 2016 marked the lowest average deal size in more than six years at just shy of USD 100 million, so the increase is off a low base.
Koen Vanhaerents, global head of capital markets at Baker McKenzie, said:
Political stability in many markets, strong performance of IPOs and sound economic fundamentals are the forces driving investor demand, while investors have also learned to live with unpredictable developments.