The coming year in IPOs will be turbulent – just like the last 12 months, according to an in-depth survey of corporate transaction attorneys.
Jeff Corbin, CEO of KCSA Strategic Communications, which conducted the survey, says that while the atmosphere is “cautiously optimistic”, the financial situation in Europe combined with the potential actions of the Obama Administration and the upcoming US presidential election have left lawyers with a sense of uncertainty. KCSA conducted interviews with 50 attorneys from firms that advised 70% of the IPOs on major US exchanges in 2011.
Half expect no change
Just under half (49%) expect the IPO market to be the same as last year and 37 % think 2012 will be slightly stronger. The majority (84%) of the attorneys think private equity-backed companies will dominate IPOs, as private equity firms look for exit strategies. The interviews, reinforced by regular discussions with institutions, suggest investors are concerned about volatility. ‘There is a desire to look to more stable companies’ Corbin says. Last year’s tech IPOs, which saw share prices fall after the initial offering, have added to concerns, he says.
China influence waning
Fears over stability also show in attitudes toward foreign issuers, especially those based in China. When KCSA did a similar survey about the outlook for 2011, 100% of the attorneys cited Chinese companies as a strong driver of US-based IPOs. In 2012, the positive view of Chinese companies as IPO drivers are held by 78% of the respondents, a drop of 22% points. According to Corbin, the two issues causing the chill are corporate governance and transparency of information. The attorneys also note conflicts in attitudes toward IPO drivers. For example, even though investors want more stable properties, they continue to demonstrate great interest in social network IPOs. Facebook is the company everyone is watching, even though big questions remain. ‘What is its business model?’ Corbin asks. ‘How does it really make money?
(°) articolo di Erik Sherman, tratto da Inside Investor Relations, Top Stories
Bianca Fersini Mastelloni
Bianca Fersini Mastelloni is Chairman and CEO of Polytems HIR. She is a seasoned consultant in Corporate Communication with extensive experience for over 30 years. Since 1999 she is active in Investor Relations and Financial Communication for companies listed on the major financial markets. Bianca provides strategic IR, corporate access in Italy, Europe, USA, investor’s market intelligence, profiling investors, critical communication and reputation. A scholar of issues pertaining to Communications and Investor Relations. Bianca studied at SUNY – State University of New York, Buffalo and at Boston University, Boston, and she works as lecturer with some Italian University. Bianca is author of the book Investor Relations ed Etica , Efficacia e Vantaggi Competitivi - edited from Guerini e Associati - as of as several articles about Investor Relations and financial communication. Bianca has been selected as the most influential CEO 2023 in Italy for Investor Relations and Financial Communications by CEO Monthly, the international publisher of AI Global Media.