Since the Business Select Committee was, at pixel time, picking over whether Royal Mail was sold too cheaply…
Here’s a relevant Dealogic list we came across on Wednesday. These are the first-day trading performances for the other, large ($1bn-plus) IPOs of privatised companies in Europe over the last 15 years: Read more
The full Citigroup blast against Nasdaq’s handling of the Facebook IPO is well worth a read. (Big hat-tip to NYT Dealbook, click to enlarge)
Google spits out about 1,690,000 search results for “facebook lock up expiry”.
It’s not exactly been a state secret that early investors in Facebook could start selling their stakes from today, when 271m shares lurch down the slipway. You could say the share price had been trying to price in this supply in recent days. Another 1.6bn shares will exit lock-up periods from now to early next year. It’s all known about, surely. Read more
Post-debut, at pixel time Manchester United shares were clinging to the $14 listing price like the Glazers to Old Trafford. (The stock was $14.06 as we went to pub.) Read more
Manchester United’s filing for its $383m IPO, finally. Click to enlarge. Enjoy!
Man Utd in deal with Chevrolet on jerseys – FT
1) It’s a punchy IPO pricing range.
2) Ooh look at the insider seller amounts. Read more
Royal Bank of Scotland’s insurance arm has taken a step closer to an expected multi-billion pound flotation by dropping the name of its parent in a rebranding exercise, says the FT. The business has renamed itself Direct Line Group, after one of its best known brands in a stable that also includes Churchill, Privilege and car breakdown service Green Flag. The name change is another sign that parts of RBS are distancing themselves from the bank’s brand. Coutts dropped the Royal Bank of Scotland name from its international businesses in November as part of its attempt to revitalise one of the oldest brands in private banking.
Facebook launched the process for its highly anticipated stock market debut, filing papers for a $5bn initial public offering that will turn key shareholders into billionaires, most notably Mark Zuckerberg, the 27-year-old chief executive and co-founder, reports the FT. Mr Zuckerberg will retain absolute control over the company. He and his close allies own 57 per cent. Mr Zuckerberg’s own 28.4 per cent stake would give him a paper worth of $22.7bn, based on secondary market trading, valuing Facebook at $80bn. Separately, the FT says Facebook’s figures suggest that its advertising base has yet to develop as far as many of its supporters had hoped – though it has already achieved strong profitability. The WSJ says Facebook’s annual revenue growth is slower than other tech companies who have staged IPOs recently.
Facebook is expected to submit paperwork to regulators on Wednesday morning for a $5bn initial public offering and has selected Morgan Stanley and four other bookrunners to handle the mega-IPO, IFR says, citing sources close to the deal. Morgan Stanley will take the coveted “lead left” role in what is expected to be the largest IPO ever to emerge from Silicon Valley, with the other four bookrunners being Goldman Sachs, Bank of America Merrill Lynch, Barclays Capital and JP Morgan, although the underwriting syndicate could be expanded later, IFR cited the sources as saying. Facebook declined to comment. Getting picked for the IPO is a coup for Morgan Stanley and Michael Grimes, the global co-head of the bank’s technology investment banking unit, says Bloomberg. The group won the biggest share of business underwriting US initial offers by internet companies last year, and taking the lead on Facebook may catapult it to the top of the US IPO league table for a third consecutive year.
Japan Airlines, which exited bankruptcy last year, is planning an initial public offering that may raise as much as 1tn yen ($13bn) as early as September, Bloomberg reports, citing two people familiar with the matter. A JAL spokesman said Nomura and Daiwa Securities were hired to lead the IPO, and the airline was selecting overseas underwriters, but he declined to comment on the size of the offering. Enterprise Turnaround Initiative, the government-affiliated agency that holds about 97 per cent of JAL’s voting rights, and other stakeholders are considering selling 500bn – 1tn yen of shares, the report says. The airline delisted after filing for bankruptcy in February 2010 and has cut a third of its staff, grounded planes and received funding from the country’s largest banks.
Zynga, the social networking games maker of FarmVille, has sold shares in an initial public offering at the top of its projected price range, valuing the company at $7bn. However, says the FT, its valuation was more restrained than past social networking offerings, pricing the company at some 11 times last year’s sales. LinkedIn and Groupon priced at more than 17 times previous-year sales. The offering for 100m shares at $10 made it the biggest technology deal to price since Google’s offering in 2004. It caps off a year that saw social networking and web groups debut despite extraordinarily volatility in capital markets that shut the IPO route to most other sectors. Company chief executive Mark Pincus received more than $109m he sold a small portion of his stake back to the games company in March at $14 a share, says the WSJ.
Zynga, the online games developer, will sell about 15 per cent of its common stock in an IPO, reports Bloomberg, citing a person with knowledge of the matter, in contrast with recent internet IPOs using a lower free float to boost demand. Zynga plans to sell shares for $8.50 to $10 each in an IPO to raise as much as $1bn, the news agency says, which would value Zynga at as high as $7bn. Meanwhile the FT reports companies that listed in the US this year are struggling to maintain share prices above their flotation price, with the typical company losing about 10 per cent of its value after its debut. The average US initial public offering has fallen by 9.9 per cent in its first six months of trading, according to Dealogic, a capital markets data provider. By contrast, the Russell 3000 Growth index, which tracks smaller companies, is up 1.1 per cent this year.
Zynga, the fast-growing online game maker, plans to value itself at as much as $10 billion in its forthcoming IPO, says NYT Dealbook, citing two people briefed on the matter. The company plans to file an amended prospectus on Friday with an estimated price range of about $8 to $10 a share, these people said. At that range, Zynga would raise roughly $900m or so. The company plans to sell up to 10 percent of its stock to public shareholders.
New China Life Insurance, a state-backed insurer planning an IPO in Shanghai and Hong Kong, has received enough orders to cover its institutional allocations for both listings, says Bloomberg, citing two people with knowledge of the transaction. The company, which is partly owned by Zurich Financial Services, is seeking to raise as much as $2.3bn in the offering. Up to 95 per cent of the shares issued in Hong Kong will go to institutional investors, the report says, and the institutional book was covered on the first day.
Facebook is targeting a timeframe of April to June 2012 for an IPO that would value the company at more than $100bn, the WSJ says, citing people familiar with the matter who say it is exploring raising about $10bn. Bloomberg says this would make it by far the biggest technology IPO, almost doubling the current record holder, Infineon, which raised $5.23bn in 1999.
Market intelligence provider Tricumen released their report on the state of the investment banking industry on Wednesday.
Their researchers sorted through an inordinate amount of company filings in order to determine the revenues by product segment, normalising along the way where possible. They also did interviews with a lot of insiders to try to build up a picture of trends (admittedly a far more interesting source of information). The report is up to, and including, the third quarter of 2011. Read more
Groupon is poised to price its IPO at $1 to $2 above its current $16 to $18 range after stronger-than-anticipated demand, Reuters says, citing buyside sources. Over the course of the pre-IPO roadshow, the IPO has drawn more interest because of a tiny 4.7 per cent float and due to Groupon’s being the first daily-deals website to go public. At $19 per share, the IPO would value Groupon at $12.02bn and at $20, it would value the company at $12.7bn. Books closed on Wednesday afternoon and the IPO is scheduled to price late on Thursday, with 30m shares due to begin trading Friday on Nasdaq.
Groupon, the online coupon seller, will seek a valuation of less than $12bn in its upcoming IPO, reports the FT, about half of what it initially wanted, according to people familiar with its plans. The company, which plans to launch its roadshow on Friday, also appears set to sell only about 10 per cent of its shares to the public, a relatively small “float”, which would mimic the approach taken in the successful offering of LinkedIn, the business-focused social network, earlier this year. LinkedIn’s shares nearly tripled in first-day trading, and the scarcity of shares on offer was said to be a boost to demand.
Groupon is set to launch an investor roadshow this week, the first step in launching its anticipated initial public offering, the FT reports, citing people familiar with the company’s plans. A roadshow typically precedes an IPO’s pricing and trading by a week or two, as executives travel to several cities globally to meet potential investors. Despite questions about its business model, it has been foremost among an eagerly awaited wave of social networking groups coming to the public markets after groups such LinkedIn met with a hearty reception earlier this year. Along with Zynga, a maker of games for mobile devices and Facebook, Groupon had expected to go public back in September. It postponed its planned $750m offering as markets tumbled, but underwriters have been planning to try again this month.
US mutual funds face having to mark down $450m of investments in Groupon that were made at discounted valuations ahead of its initial public offering, given the continued freeze in the IPO market, the WSJ reports. Four key funds had expected to triple their money as valuations of Groupon’s business rose in the wake of its IPO plan, following their investment at a $4.7bn valuation. Estimates of Groupon’s value in an offering have since fallen from $30bn to $10bn or $5bn, because of the IPO delay and growing doubts over its business model. Meanwhile, the social gaming company Zynga is pushing on with releasing new titles despite the stagnation of its own IPO plans, the FT says.
San Miguel’s power unit delayed an $854m IPO that would have been the Philippines’ biggest first-time share sale, Bloomberg says, citing two people with knowledge of the matter. San Miguel’s SMC Global Power Holdings put the IPO on hold because of volatile markets, one of the sources said. The Philippines’ securities regulator last month approved a plan to sell up to 519.8m shares at as much as 71 pesos apiece. Including options to expand the IPO, it might have raised as much as 36.9bn pesos ($854m), according to a filing by SMC Global Power, which Bloomberg says would have made it the biggest IPO in the country.
Citic Securities, China’s biggest brokerage by market value, declined in its Hong Kong trading debut, Bloomberg reports. Shares in the company fell fell as much as 11 per cent to HK$11.90 and traded at HK$12.2 at 11:01am. Citic Securities, which is also listed in Shanghai, sold 995.3m shares at HK$13.30 each last week, raising HK$13.2bn ($1.7bn) in Hong Kong’s biggest public stock offering in more than three months. Several other companies have cancelled or postponed planned IPOs in Hong Kong. The Hang Seng rose as much as 4.3 per cent on Thursday but the Hang Seng China H-Financials Index, which tracks large Chinese financial stocks listed in the city, has dropped nearly 16 per cent between Citic Securities priced its shares and Thursday.
Essar, one of India’s largest conglomerates, is planning to raise about $750m from an initial public offering of its infrastructure assets on the London Stock Exchange, the FT reports, citing people close to the matter. The flotation is expected to go through early next year, as the Mumbai-based company hopes market jitters – which have led many groups to postpone their listings in recent weeks – will subside by then. The company, controlled by billionaire brothers Shashi and Ravi Ruia, has hired JPMorgan and Credit Suisse to help it merge its port and construction units into a new entity that would be listed as Essar Infrastructure, two sources said.
Spain has scrapped the €7bn privatisation of its state lottery in the face of turbulent markets and mounting domestic political opposition to what would have been Spain’s largest stock market flotation, the FT reports. In an 11h-hour decision the Spanish government said market volatility meant that its plan to sell 30 per cent of Loterías y Apuestas del Estado, which organises the Christmas El Gordo lottery, could not be guaranteed to raise enough to reflect its true value. Spain’s socialist government had planned to use an expected €12bn of proceeds from the sale of Loterías, and the part privatisation of AENA, the state airport authority, to help pay down debt at a time when the sovereign debt crisis in Europe has pushed Spain’s borrowing costs to levels not seen since it abandoned the peseta. Bloomberg reports Spain has one bond redemption left this year of €14bn, and expiring bills worth about €23bn, according to data from the Treasury in Madrid, and €40bn in cash at the Bank of Spain at the end of June, according to government data.
A logjam of US initial public offerings has stretched to its longest in four years while the number of companies withdrawing deals has increased, the FT says. Anxiety over the eurozone debt crisis and the economic slowdown has hit equity fundraising, dashing hopes of a revival that followed strong debuts for internet companies such as LinkedIn and Pandora. According to Dealogic, the capital markets data provider, 146 companies, seeking to raise $28.4bn, are now on file with regulators to sell shares in the US, the longest queue since 2007. At this time last year it was 142 companies, seeking to raise $44.6bn. But they also noted that 215 IPOs had been withdrawn or postponed so far this year, representing some $44.1bn. That is the most by September in at least 20 years, surpassing the previous high in 2008.
The WSJ says a Chinese company, Beijing Jingdong Century Trading, is preparing for what could be the biggest internet IPO in the US. The company operates 360buy.com, a fast-growing site that sells a broad range of goods, mostly direct to consumers, much like Amazon.com. Jingdong hopes to raise as much as $4bn to $5bn from an IPO in the first half of 2012, people familiar with the situation told the newspaper. Meanwhile China’s Citic Securities plans to raise as much as HK$15.1bn from an initial share sale in Hong Kong, Bloomberg says, citing two people with knowledge of the matter. The Shanghai-traded brokerage is offering 995.3m shares at HK$12.84 to HK$15.20 each, the reports says, and Citic executives will start meeting potential investors on Friday to market the sale. It would be the biggest share sale in Hong Kong since Prada raised $2.5bn in its June IPO. Stock offerings in Hong Kong have dwindled since then, as the European debt crisis escalates and the US outlook worsens.
Siemens, the German engineering conglomerate, said it would delay a multibillion-euro flotation of Osram, its lighting unit, due to volatile conditions in capital markets that looks set to disrupt a long pipeline of other potential German listings, the FT reports. Siemens said it held firm to its plan to list Osram, the world’s second-largest maker of lighting, as its seeks to focus on its core activities in energy, healthcare, industry and infrastructure. However, it said that in view of the “highly volatile environment on the capital markets and possible effects on the industry” Osram would now be listed at a later date.
Facebook is preparing to launch its blockbuster initial public offering in the US towards the end of next year, the FT says, citing people familiar with the company. Mark Zuckerberg, Facebook’s chief executive, wants to wait until next September or later in order to keep employees focused on product developments rather than a pay-out, the sources said. The IPO, expected to be one of the world’s biggest with recent private share sales valuing Facebook at more than $66.5bn, has been expected by April 2012, with persistent speculation that it could even come this year. The WSJ meanwhile reports that 63 per cent of 2011 IPOs in the US are now underwater, hit by both the fall in stocks and volatility, making issues difficult to price.
The extreme turbulence of Europe’s financial markets looks set to scuttle a raft of big initial public offerings initially slated for this autumn, including those of heavyweight German industrial companies such as Evonik and Osram, says the FT. Though no formal decisions have been made on these potential IPOs – which together could have raised more than €10bn ($13.5bn) – people close to the deals said fearful markets would preclude any flotations for the foreseeable future. “It would take a brave man to go to the markets now,” a senior banker said. “Unless there’s a remarkable rally in Germany soon I just can’t see it.”
The two most closely-watched consumer internet companies expected to go public on Wall Street have pulled back from selling shares this month amid a spike in market turbulence, the FT reports, citing people familiar with the deals. Groupon, the online coupon-seller, and Zynga, a maker of games for Facebook and other platforms, had pencilled in debuts shortly after the Labor Day holiday, traditionally a busy time for initial public offerings in the US. But with markets remaining volatile, both have cooled on plans that would have seen them early this month mount “road shows”, the marketing trips in which companies promote their shares to institutional investors ahead of an IPO. The companies declined to comment. Bloomberg says its data show US IPOs have been shelved or scrapped at a faster rate in the past three months than the comparable period of any year since 2004.