The First Reporter

NEW YORK, Dec. 17 /PRNewswire/ — The number of initial public offerings (IPOs) in the United States rose consistently during each quarter of 2009, with fourth-quarter IPO activity reaching new levels and generating the highest quarterly proceeds since the first quarter of 2008, according to a quarterly survey of all IPOs on U.S. exchanges from PricewaterhouseCoopers’ Transaction Services practice.

There have been 32 IPOs completed in the fourth quarter, raising $16.8 billion, a 190% increase over the $5.8 billion raised in the third quarter, which saw 20 offerings completed. Fourth quarter deal volume included seven IPOs from overseas issuers: six from China and one from Brazil. These non-U.S. issuers contributed approximately 45% of the quarter’s total IPO proceeds to date, raising $7.6 billion in total. The Banco Santander S.A. offering from Brazil was the largest IPO of 2009, raising $7.0 billion.

“As anticipated, the surge in IPO activity during the final quarter of 2009 restored the historical trend of robust IPO activity in the fourth quarter, which was lacking last year,” said Scott Gehsmann, a capital markets partner in PricewaterhouseCoopers’ Transaction Services Practice. “The significant uptick in IPO activity affirms investor confidence is returning to the IPO market as we enter the New Year. We expect the momentum to continue into 2010.”

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Notwithstanding a dismal start in the first quarter, with only two IPOs, the year as a whole through December 16 saw 66 IPOs, eclipsing total deal volume for 2008. That said, comparison of the IPO activity in the fourth quarter of 2009 to earlier years indicates that deal volume has fallen since the 2007 peak. While the 32 IPOs in Q4 2009, with $16.8 billion raised, represent a significant rebound from the three IPOs that raised only $200 million in Q4 2008, deal volume for the quarter was still less than a third of Q4 2007.

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“This quarter marked the return of financial sponsor-backed IPOs, in sharp contrast to 2008 and much of 2009,” continued Gehsmann. “The IPO market has been reestablished as a viable exit for private equity investments.”

More than half of the IPOs completed this quarter (19) were financial sponsor-backed deals.

The Banco Santander S.A. IPO, with proceeds of $7.0 billion, drove the Financial Services sector in terms of quarterly deal value. Financial Services sector deal value totaled $7.7 billion in the fourth quarter. Excluding Banco Santander, IPO activity in the Financial Services sector was low compared to the previous quarter when five Real Estate Investment Trusts (REITs) went public. The Healthcare sector held the top spot in terms of deal volume, with seven companies going public and raising a total of $1.6 billion. There was also significant activity in the Retail, Business Services and Technology sectors.

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Among stock exchanges, the NYSE led in terms of proceeds, with 73% of total offering value during the fourth quarter, with volume split equally between NYSE and NASDAQ.

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Global IPO activity showed similar trends. IPOs in Greater China raised $22.0 billion during the first two months of the fourth quarter, almost as much as the $23.9 billion that was raised in the whole of 2008. Brazil saw two of the largest IPOs of 2009, VisaNet in the second quarter and Banco Santander, which was dual-listed in Brazil and the US. European markets also saw an increase in capital raised in the fourth quarter of 2009 relative to both the earlier quarters of 2009 and the fourth quarter in the prior year. PGE (Polska Grupa Energetyczna), SA, Poland’s largest power group, raised $2.1 billion in the fourth quarter, making it the largest European IPO of the year through November.

U.S. IPO Watch is a quarterly survey of all IPOs listed on U.S. exchanges. These include IPOs by domestic and foreign companies, best-efforts, business development companies, filings with the FDIC, and bank demutualizations. IPOs do not include unit investment trusts and fully classified closed-end funds. Visit our website, www.pwc.com/ustransactionservices, for our 2006, 2007 and 2008 U.S. IPO Watch reports.

The PricewaterhouseCoopers Transaction Services practice provides due diligence for M&A transactions, along with advice on M&A strategy and integration, restructuring, divestitures and separation, valuations, accounting, financial reporting, and capital raising. With approximately 1,000 deal professionals in 16 cities in the U.S., and a global network of over 6,000 deal professionals in 90 countries, experienced teams are deployed with deep industry and local market knowledge, and technical experience tailored to each client’s situation. The Transaction Services team can be involved from strategy to integration and employ an integrated business approach to uncover the realities of a deal. The field-proven, globally consistent, controlled deal process helps clients minimize their risks, progress with the right deals, and capture value both at the deal table and after the deal closes. For more information, visit www.pwc.com/ustransactionservices.

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© 2009 PricewaterhouseCoopers LLP. All rights reserved.

SOURCE PricewaterhouseCoopers Transaction Services