Q2 2014 has posted the highest volume in dollar-terms of Global Tech IPOs (initial public offerings) since 2008 – two-and-a-half times the number of tech IPOs in Q2 2013, says a new report by PwC.
The “Q2 2014 Global Technology IPO Review” reported that forty-three tech companies went public on 10 exchanges in ten different countries thanks to steadily improving economic conditions worldwide plus strong capital markets in the United States.
The authors wrote that Europe saw the return of tech IPOs following improved economic conditions in the euro area.
Global Technology Industry Leader at PwC, Raman Chitkara, said:
“With the results this quarter, the first half of 2014 has now witnessed more tech IPOs than all of 2013. Barring a major market disruption, 2014 has the potential to surpass even pre-financial crisis global tech IPO activity.”
Tech IPOs in China and the US
More than half (27) of all Global Tech IPOs occurred on the US stock exchanges, specifically the New York Stock Exchange (NYSE) and NASDAQ during the second quarter of this year.
Five of them took place in China, including three in Hong Kong.
In the United States, 15 tech companies went public in Q2 compared to 12 in the first quarter. IPO proceeds jumped by 162% to $4.1 billion.
Of the 14 Chinese tech companies that completed IPOs, only two were listed on Chinese exchanges in Shanghai and Shenzhen. Out of the top ten deals in Q2, two were Chinese companies, with aggregate funds raised rising by 277% compared to the previous quarter.
(Data source: PwC)
European revival
Tech IPOs in Europe raised more dollars during the first six months of 2014 than in any full year since 2008.
A total of 8 European tech firms went public, raising $4.02 billion. Five of them listed in London, one in Paris and two on NASDAQ.
Cross-border listings
After a brief fall in the first quarter, cross-border deals rebounded in Q2, with 13 (30%) of the companies raising funds from foreign exchanges (outside their headquarters’ country).
Deals by subsector
- Internet Software & Services: 21 deals that raised $5.173 billion.
- Software: 11 deals that raised $3.096 billion.
- Semiconductor: 4 deals that raised $418 million.
- Computer & Peripherals: 1 deal that raised $782 million.
- Electronics: 2 deals that raised $618 million.
- Communications equipment: 2 deals that raised $206 million.
Definition of IPO: An Initial Public Offering, sometimes referred to as a ‘stock market launch’ or ‘flotation’, is when a company moves to make its shares available for members of the general public to purchase. It is the conversion of a private company into a public company. IPOs are used by firms to raise money (capital).
Video – The Global Tech IPO Market
In this video, Raman Chitkara, Global Technology Leader at PwC, discusses the changing global technology IPO market, as well as disruptive innovation’s effect on technology companies.