Global IPO Watch - Q2 2020

July 2020

Q2 2020

Global equity markets have seen a strong bounce back from the low points seen in March 2020. Whilst market volatility has reduced from the height of the global pandemic, it remains elevated as the global economy continues to grapple with the effects of COVID-19.

IPO and FO activity followed the trajectory of global equity markets as the quarter developed. June was the strongest month of issuance with 53% and 43% of the Q2 2020 IPO and FO proceeds raised respectively in the month.

Q2 2020 saw the highest levels of global FO activity in terms of number and money raised since Q4 2009 ($263.6bn). A total of 1,060 transactions raised $240.5bn in the quarter (Q2 2019: 788 / $119.8bn). FO activity was heightened across all regions as all developed markets felt the impact of COVID-19.

Global IPO activity remained subdued, however, a resurgence in the US IPO market towards the end of the quarter contributed to 186 IPOs raising $42.3bn (Q2 2019: 290 / $66.1bn) – the Americas accounted for 61% ($25.6bn) of global IPO proceeds in the quarter.

The outlook for the remainder of 2020 remains highly uncertain as the markets assess the trajectories for the exit from lockdown and the sustained effects of the COVID-19 virus. Ongoing volatility can be expected as the markets respond to newsflow.

In the second half of the year, we expect to see further offerings, either in anticipation of acquisitions or as companies rebuild their balance sheets, and growing support for IPOs, particularly in favoured sectors where companies are able to demonstrate their ability to prosper during and after the pandemic.