The IPOX® Update 10/6/23

Exxon Mobil In Talks for a $60 Billion Acquisition of GINDEX® member Pioneer Natural Resources

U.S.-based multinational oil and gas corporation Exxon Mobil is in advanced discussions to acquire a member of our IPO M&A-focused GINDEX® U.S. Index (GNDX). Pioneer Natural Resources, a significant Permian basin oil producer, is to be purchased in a deal potentially valued at approximately $60 billion. If it materializes, this acquisition would stand out as Exxon’s largest since its 1998 purchase of Mobil for $81 billion. Amidst these talks, Pioneer experienced a nearly 12% surge in its share price pre-market. A deal of this magnitude would bolster Exxon's standing in the Permian basin, one of the United States' most lucrative oil production regions. Despite Exxon currently producing 620,000 barrels of oil equivalent per day (boed) in the Permian basin, Pioneer has been outproducing it with an average of 711,000 boed. The deal, however, is likely to be under the microscope, facing possible political and regulatory scrutiny due to recent criticisms from the White House directed at Exxon's profits. In the past, Pioneer made substantial acquisitions, including the purchase of DoublePoint Energy for $6.4 billion in 2021 and Parsley Energy in 2020. (Source)

SoftBank's Arm to be Scrutinized by Wall Street After Monumental IPO

British semiconductor and software design company Arm, owned by Japanese conglomerate SoftBank, faces close scrutiny from Wall Street following its massive IPO, the largest the United States has seen since 2021. Since its initial pricing at $51 on September 13, the firm has experienced a modest gain of about 3%, despite various analysts approaching its future with caution. Some express skepticism toward its valuation, with David Trainer, CEO of New Constructs, labeling Arm's IPO as overpriced and predicting a potential long-term decline in stock value. Contrarily, Pierre Ferragu from New Street Research lifted the price target to $66, projecting a 20% boost in 2025 royalty revenue. Analyst reviews on Arm's performance have been mixed, with one buy rating, three holds, and one sell, and an average price target hovering around $53. Observers are also keenly watching Arm’s, Instacart’s, and data automation platform Klaviyo’s IPO performances as barometers for investor sentiment towards newly listed firms. (Source)

Eagle Football Holdings Gears Up for a Potential IPO

Eagle Football Holdings, a company with a diverse portfolio of football clubs, has instigated discussions regarding a significant equity raise and potential IPO. The owner, John Textor, is reportedly exploring a $200 million equity raise ahead of a prospective IPO on the New York Stock Exchange. The portfolio of Eagle Football includes prominent clubs such as the UK's Crystal Palace FC, Brazil’s Botafogo, and Belgium’s RWD Molenbeek. By operating a multi-club ownership model, the company provides a platform for cost-sharing and forming potentially lucrative commercial deals across the teams. Furthermore, the strategic plans reveal intentions to leverage assets and investment into developing football academies across different regions, including Brazil, Dakar, and Florida (Source).

European Firms Navigate Through IPO Complexities

The IPO waters prove to be tumultuous for several European companies, especially for Germany-based Renk, which recently withdrew its planned listing due to unsuitable market conditions. The firm aimed for an IPO valuation upwards of 1.8 billion euros but retracted amidst an unstable environment, where peer companies like Hensoldt and Rheinmetall experienced trading downturns. It’s a pertinent time for European firms, such as CVC Capital Partners, facing their own set of IPO-related challenges and risks. CVC Capital Partners, a Luxembourg-based private equity firm, is eyeing a November listing with aspirations to raise around 1 billion euros ($1.05 billion), threading cautiously amidst the current market volatility and fluctuating performances from recent significant U.S. IPOs (Source).

SAL Saudi Logistics Services Co. Attracts Immense IPO Demand

Saudi-based logistics company SAL Saudi Logistics Services Co. has drawn a staggering $48.6 billion in orders for its $678 million IPO, pricing its shares at 106 riyals each and catapulting the company’s valuation to 8.48 billion riyals. The shares, offered by Saudi Arabian Airlines Corp. and Tarabot Air Cargo Services Ltd., represent a 30% stake in the company. Set to become Saudi Arabia’s second-largest IPO this year, it succeeds ADES Holding Co.'s $1.2 billion offering. Institutional investors showcased a potent appetite, bidding for a monumental 72 times the available shares. Retail investors will get their chance from October 11 to 13, with HSBC Holdings Plc’s Saudi unit orchestrating the IPO (Source).

Indonesia Revels in Sustained IPO Activity Amidst Green Energy Uptake

Experiencing a bountiful period of IPO activity, Indonesia has raised a commendable $2.4 billion within a mere 20-week span. The nation, a predominant force in nickel mining, is riding the wave of escalated green energy adoption. Metals companies, especially nickel processor PT Trimegah Bangun Persada (also known as Harita Nickel), have significantly enhanced the prevalence of IPOs in the region. An influx of foreign investor interest in Jakarta underscores a growing global appreciation for the market opportunities presented within Indonesia. While Singapore’s IPO market grapples with a 95% decrease in money raised compared to 2022, Indonesia’s momentum continues unabated, albeit the forthcoming general election in February may sway IPO activity and fundraising paces (Source).