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U.S. IPOs Solid In 2012 Despite Challenges: Report

 December 11, 2012 01:12 PM

2012 will go down in the books as a solid year for IPOs, and much stronger than 2011, despite global economic issues, the U.S. election and the looming uncertainty of the US fiscal cliff, according to Ernst & Young's U.S. IPO Pipeline Analysis.

A recent string of strong earnings reports could add a few deals to the pipeline before the end of 2012, Ernst & Young noted in its analysis report.

However, with only one effective IPO so far this month, the largest commercial REIT in history being acquired, and five companies withdrawing their offerings in late November, December is on track to have its slowest month since 2008.

As of December 7, 2012,130 IPOs on US exchanges raised more than $45 billion in proceeds compared to 124 IPOs and $40 billion in 2011, Ernst & Young said.

[Related -Market Needed a Yellen Bump and Didn't Get It.]

Ernst & Young said October stood out as the busiest month of 2012 raising the most proceeds with 21 IPOs and more than $6 billion in capital.

Overall, Ernst & Young said, the equity market has performed better this year and the S&P 500 index increased 12.5 percent in 2012 year-to-date versus a loss of 1.1 percent for 2011.

According to Ernst & Young, the top three sectors for IPO companies in 2012 are Technology, Oil & Gas, Life Sciences as well as Emerging Growth Companies. These sectors will continue to lead the IPO market in the first half of 2013.

"We expect 2013 to be on par with 2012 in terms of deal size, and the sectors that will be in play," said Jackie Kelley, Americas IPO Leader, for the Ernst & Young organization. "Resolution on the Fiscal Cliff and a strong retail season could drive a boost in the pipeline late in the quarter and early into 2013."

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