By Bob Blandeburgo
Goldman Sachs Group Inc.’s (NYSE:
) initial public offerings (IPO) guru Tom Tuft has joined Bruce Wasserstein’s Lazard Ltd. (NYSE:
) as chairman of Global Capital Markets Advisory and vice-chairman of its U.S. investment banking, in what could be a sign that the market for IPOs is thawing.
Tuft, a 33-year Goldman vet who co-founded its equity capital markets business in 1985 and became its chairman in 2004, was involved in several high-profile IPOs, including those of The Estee Lauder Companies Inc. (NYSE: ) and RJR Nabisco Inc. He also advised Lazard on its own IPO in 2005.
A slowdown in mergers and acquisitions has prompted Lazard to expand its equity capital markets and restructuring operations, working on nine of the top 10 bankruptcies this year, Bloomberg News reported. Capital raised by IPOs in the first half of this year was $11.4 billion, down 85% from the same period last year according to data compiled by Bloomberg.
“There is demand for companies to come public,” David Menlow, president of IPOFinancial.com told Bloomberg. “The fact that we haven’t seen that many is not an indication that companies are not out there ready to come public.”
There have been 21 IPOs this year, compared to hundreds from a few years ago. Still, companies continue to go public in this uncertain economic environment, including big-name companies like Dole Food Co. Inc. and Hyatt Hotels Corp.
The pace of IPOs will likely rise to about three a week on average, as long as the economy remains stable and the market doesn’t deteriorate, University of Florida finance professor Jay Ritter told The Associated Press. Ritter attributed his estimate to a similar period in 2003 to today when the economy was making its recovery from the dot-com bubble burst of 2001.
