M&A Bankers Developing Serious Jealousy Of IPO Guys

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Investors are game for a shopping spree. Corporate executives are less so. In more ways than one.

In the first quarter, 36% of U.S. IPOs were priced above the range originally outlined in registration documents filed with the Securities and Exchange Commission. That was the highest proportion in any year since at least 2004, according to Renaissance Capital, an IPO research and investment-management firm.

Meanwhile, less than one quarter of IPOs so far this year have priced below expectations, also the lowest rate in at least 10 years.

Only 8,115 deals were announced worldwide in the first quarter of this year, the lowest number since 2003, according to data from Thomson Reuters. And while the combined value of $542.8 billion outpaced last year’s first quarter by about 10 percent, it is still 26 percent below the level for the period in 2011.

Bankers and lawyers have been publicly boasting about a nascent revival in mergers. In March, 97 percent of deal makers surveyed by the Brunswick Group public relations firm said they expected more deals to be announced in North America this year than in last.

But privately, many have conceded that for all of the improvements in the economy and corporate profits, executives still lack the confidence to sign for a big deal.

IPO Pricing Signals Surge In Demand [WSJ]
Mergers Slowed to a Snail's Pace in the First Quarter, the Fewest Since 2003 [DealBook]
Investors Ignore Negativity at Their Peril [WSJ]

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