The IPOX® Update 11/20/23
IPOX® CEO Josef Schuster Analyzes IPO Market Dynamics
IPOX® CEO Josef Schuster provided critical insights into the IPO market's recent trends in the latest issue of Kiplinger Personal Finance. He noted that 2022 marked a significant downturn in IPO activity, with only 65 deals raising less than $10 billion. This decline was partly attributed to the downturn in the technology sector, which heavily influenced the overall IPO market. In contrast, the first nine months of 2023 saw a notable rebound, with 76 IPOs raising nearly $15 billion. Schuster highlighted the volatile nature of IPOs and stressed the importance of making informed investment decisions. The performance of the IPOX 100 U.S. Index ETF (First Trust US Equity Opportunities ETF), which has outperformed the S&P 500 since its launch, was emphasized as a testament to the potential of careful IPO investments. Looking forward, Schuster remains optimistic about the IPO market, anticipating a continued rebound through 2024. This analysis underscores the dynamic and ever-changing nature of the IPO landscape. (Link to Article)
Private Equity Giants Reacquire Companies Post-IPO Slump
Amid the recent downturn in initial public offerings (IPOs), prominent private equity firms like EQT, Cinven, and Silver Lake are strategically buying back public companies they previously owned. This trend follows a record year in 2021, where 287 company IPOs managed by buyout houses raised nearly $140 billion. Many of these IPOs are currently trading below their initial prices, presenting ripe opportunities for buybacks. Notable examples include Suse, a German software company, Synlab, a European clinical laboratory service provider, and Endeavor, an American entertainment and media agency. These repurchases present challenges for the private equity firms, particularly in relisting these companies. Furthermore, this approach has sparked controversy among investors in private equity funds and public equities fund managers, questioning its long-term viability. (Source)
Turkey's IPO Market Set for Surge with 100 Companies in Pipeline
Turkey's IPO landscape is experiencing a significant upswing, with nearly 100 companies poised for 2024 listings. The Chairman of the Capital Markets Board, Ibrahim Omer Gonul, anticipates around 50 IPOs annually in Turkey. This follows a record-breaking year in 2023, with 49 companies listing on Borsa Istanbul, raising $2.9 billion. Turkish IPOs have gained traction among investors, evidenced by 75% of the 2023 debuts seeing substantial growth in their first five days. Despite this optimism, Gonul advises caution to retail investors, reminding them that returns from IPOs are not guaranteed. The rise in deposit rates poses a potential challenge to the influx of new IPO listings in Turkey. (Source)
Carmot Therapeutics Targets IPO Amidst Obesity and Diabetes Drug Development
Carmot Therapeutics, a biopharmaceutical company focusing on metabolic diseases like obesity and diabetes, has announced its intention to go public. The company, known for its work on GLP-1 drug candidates, is aiming to develop treatments that are more potent than existing drugs such as Ozempic and Mounjaro. With three GLP-1 drug candidates in development, Carmot Therapeutics aims to address limitations of current treatments. The underwriting for this IPO is backed by J.P. Morgan, BofA Securities, Piper Sandler, and Guggenheim Securities. The company highlights the extensive patient population affected by obesity and diabetes, numbering over 750 million globally. The firm aims to raise up to $100 million through the IPO, which may be a placeholder amount. Previously, Carmot Therapeutics secured $150 million in funding in May, valuing the company at $1.25 billion. (Source)
