2010-07-07 15:25

PARIS - Company flotation (Initial Public Offering or IPO) worldwide sustained considerable growth in the second quarter this year despite slow economic recovery, international auditor Ernst & Young said Tuesday.

Listings were mainly driven by a strong Asian market and increased listings in the United States and Europe, the company said in a newsletter that includes Q2 2010 Global IPO Update and the Global IPO Trends Report 2010.

"We have seen some positive signs of IPO activity in the past six months, and we remain confident that the IPO market will grow over the next two quarters," Franck Sebag, a partner for strategic growth markets at Ernst & Young, was quoted by the newsletter as saying.

There were 301 initial public offerings (IPOs) worldwide to raise a total of $46.1 billion in the second quarter, compared with 290 IPOs valued at $52.6 billion in the first quarter.

The largest IPO in the quarter was Samsung Life Insurance Co Ltd., which was listed on the Korea Stock Exchange in April to raise $4.4 billion.

In the first half, $98.8 billion were raised, up from the $11.8 billion from 134 deals in the same period last year.

Asia took 65 percent of the global IPO market in the second quarter, with 159 deals worth a total $25.7 billion, compared with $35.4 billion and 172 IPOs in the first quarter, the report said.

"Asia, offering huge opportunities for growth, continues to be leading the world in the recovery of the capital market," Sebag said.

China's robust economic growth and rising domestic consumption were a major driver of the IPO market, the report said.

European and US listings also witnessed an increase. Europe raised 18 percent of the capital, while North America contributed about 12 percent.

Poland was one of the leaders with $4.1 billion raised. Two of the 10 largest IPOs globally were from Poland. Ernst & Young said the Polish economy held up better than most central and eastern European countries through the recession.

Private-equity-backed IPOs make significant contributions to the growth of listing companies.

"Many of the deals are coming from growth industries, including the technology, media and entertainment and healthcare sectors. Issues in these sectors are being oversubscribed between three to five times, illustrating the current market demand," Sebag said.