The IPO market is expected to be very hot this summer.

Public filings are looming for Chinese rideshare company Didi Chuxing Technology Co. and Robinhood Markets Inc., two of the most anticipated initial public offerings of 2021, people familiar with the matter said. Their shares are expected to start trading in July. Fund managers, venture capitalists, bankers and lawyers have said they are busier than they have been in decades at this generally quieter time of year. Some argue that business is even crazier than during the dot-com boom of the late 1990s.

From June to August, IPOs listed in the United States could raise up to $ 40 billion, some bankers estimate. This would eclipse the previous record of $ 32 billion in those three months, set last year, according to Dealogic data dating back to 1995. This does not include money raised by special purpose acquisition companies. , or SPAC, which were unleashed earlier this year. year but have slowed down.

Didi Chuxing defeated Uber Technologies to claim dominance in China.



Photo:

Jason Lee / Reuters

Some bankers have said they are working with more than two dozen companies that have confidentially filed IPOs and plan to launch road shows to introduce investors in the coming weeks.

“As prolific as the show was last summer, we believe this year will exceed that number,” said Jim Cooney, head of US equity markets at

Bank of America Corp.

“It’s about to be the busiest yet.”

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Didi Chuxing, who beat

Uber Technologies Inc.

claim the domination of carpooling in China, could reach a valuation in excess of $ 70 billion, said a person familiar with the matter. Robinhood, the app that empowers individual traders that fueled the memes stock revolution, could be valued at $ 40 billion or more when it goes public, according to people familiar with the matter. Car battery company Clarios is also expected to go public in July, people familiar with the matter said, aiming for a valuation of around $ 20 billion.

There are plenty of companies showing in the coming weeks, including Krispy Kreme and cybersecurity company SentinelOne.

The expected increase in IPO activity comes after the decline in popularity of PSPCs and the booming IPO market hit a slowdown in May. Investors, fearing inflation and volatility, moved away from tech stocks. Recent IPOs have fallen below their offer prices and several launches have been postponed.

But instead of a long-term cooling, the situation has stabilized. Tech stocks have rebounded, volatility has eased, and some large IPOs have gone off without a hitch. As of Tuesday, traditional U.S.-listed IPOs have raised more than $ 63 billion, the biggest year on record, according to Dealogic.

Swedish oat milk manufacturer

Oatly Group


ONLY 2.05%

AB has set its IPO for mid-May at the top of the range, which gives it a valuation of around $ 10 billion, well above its valuation less than a year earlier. Shares jumped 19% on day one trading, and the stock is up more than 50% from its IPO price. Construction management software company

Procore Technologies Inc.


PCOR 0.24%

valued its IPO in May above expectations and debuted with a valuation of nearly $ 10 billion.

Tuesday the payment company

Marqueta Inc.


QM -0.98%

valued its IPO higher than expected, valuing the company at $ 15 billion. Its stock jumped 13% when it debuted on Wednesday.

Other recent IPO actions have gained momentum. Shares of companies that went through a traditional IPO in 2021 rose an average of 6.9% until Tuesday, according to Dealogic. A month ago, they were up 2.1%.

The tech-laden Nasdaq Composite, which was briefly negative for the year in early May, is up 7.9% in 2021 and is within 2% of a record high.

Some bankers and investors attribute this turnaround to a certain conservatism regarding the offers. The size of transactions has shrunk, which is helping to strengthen demand and support prices. In the first three months of the year, IPOs in the United States raised an average of $ 428 million. Since then, companies have raised 16% less on average, according to Dealogic.

Also useful for traditional IPOs: a downturn in the PSPC market. As some PSPC shares fell and the deals failed, fewer companies are looking to go public through blank check mergers. This added to the traditional IPO pipeline, according to bankers and lawyers. Fewer PSPC mergers seeking private investment in public stocks free up time and money for large fund managers to use in traditional IPOs.

The flow of businesses turning to government procurement is not expected to slow down after Labor Day. Grocery delivery giant Instacart Inc. plans to go public by direct listing at the end of 2021, according to people familiar with the matter. One consideration for the business, said one of the people, is that year-over-year growth comparisons are difficult for the spring quarter due to the robust activity of Instacart at the start of the year. pandemic.

Other mainstream brands, including famous shoe maker Allbirds and clothing rental company Rent the Runway, are also considering IPOs, people familiar with the matter said.

“The world is changing rapidly,” said Marc Jaffe, managing partner in the New York office of Latham & Watkins LLP. “Good ideas pass good ideas ringing the bell in record time. “

Vlad Tenev, chief executive of Robinhood, which could be valued at $ 40 billion or more when it goes public, testified at a congressional hearing in February.



Photo:

Daniel Acker / Bloomberg News

Write to Corrie Driebusch at corrie.driebusch@wsj.com

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