IPO Money Goes Elsewhere in 3rd Qtr.
Russia, once the record-setter on the IPO market, practically disappeared from it in the third quarter, in spite of reasonably favorable conditions, according to the latest report by Ernst & Young. Of the $27 billion attracted by issuers in the BRIC countries (Brazil, Russia, India, China) between July and September, almost none of it went to Russia. In the meantime, market conditions are only going to get worse.
The market for initial public offerings remained in fine form in the third quarter, in spite of the August subprime crisis. According to the E&Y report, 428 IPOs brought in $57 billion worldwide.
The number of deals and amount they raised is lower than in the second quarter of this year, but higher by a quarter than the third quarter of last year. The share of BRIC in the IPO market was significant – 118 deals for $27 billion. There were no Russian deals even among the top 20 of them, although 12 of those 20 took place in developing countries. China was the world leader, with $14.4 billion, up 79 percent over the previous quarter. It was followed by Brazil ($9.3 billion) and the United States ($8.3 billion).
Rusal, OGK-6 and Sibur postponed IPOs indefinitely in the third quarter. Analysts attribute that to the fact that offerings of that scale are mainly of interest to foreign investors, which were affected by the subprime crisis and were interested in companies with strong credit histories, of which there are more in China and Brazil. Thus the problems of the Russian IPO market are largely the shortcomings of Russian investors.
www.kommersant.com
All the Article in Russian as of Oct. 24, 2007
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