Wednesday, April 04, 2018

Q1 sees twice as many IPOs as the first quarter of 2017

By John Filar Atwood

The IPO market finished the first quarter, which began with a record-breaking January, with 55 new issues, nearly twice the Q1 2017 total of 28. Seventeen of the deals were completed in March, a slight improvement over February’s 16 offerings. The last week of March saw seven companies go public, including four that are headquartered in China. Nine of the year’s new issuers operate out of China. Business services companies (SIC 7389) Bilibili and iQIYI were two of the week’s Chinese new issuers. Beijing-based iQIYI raised $2.25 billion in the year’s second largest IPO to date, while Bilibili netted $483 million for its online entertainment business. Morgan Stanley, which led Bilibili’s IPO, also served as lead underwriter on deals by OneSmart International Education and GreenTree Hospitality. OneSmart was the second China-based education services provider to go public in the U.S. in the past two weeks. Last week’s other three IPOs were completed by pharmaceutical companies Homology Medicines, Genprex and Unum Therapeutics. The offerings by Homology and Unum raised the number of Massachusetts-headquartered new issuers in 2018 to five. Genprex’s $6.4 million offering was the second smallest of the year so far.

New registrants. The week’s activity included seven new registrations, four of which were filed by prepackaged software companies (SIC 7372). Morgan Stanley was selected as first lead manager by Smartsheet and DocuSign. Smartsheet offers a platform for businesses to plan, manage and report on work progress. DocuSign enables users to move from paper-based to digital agreements, transactions and approval processes. Human capital management software provider Ceridian HCM Holding registered a $200 million offering. In connection with its IPO, Ceridian intends to contribute its LifeWorks employee assistance division to company shareholders. Shanghai-based CLPS, a provider of consulting services to insurance and financial services companies, also registered. The company derives a significant portion of its revenues from major customers Citibank and eBay. HeadHunter Group, which operates out of Cyprus, is hoping to raise $200 million through its IPO. HeadHunter offers an online job recruitment platform in Russia and the Commonwealth of Independent States. The last IPO in U.S. markets by a company headquartered in Cyprus was in May 2013. The week’s other new registrants are nLIGHT and Singapore-based ASLAN Pharmaceuticals. nLIGHT provides high-powered semiconductor and fiber lasers. ASLAN, whose development program is centered in Asia, makes treatments for several kinds of cancer. Overall, the pace of new registrations increased in March with 22 filings compared to 14 in February. There were 53 preliminary registrations in the first quarter, which is eight more than were filed in the first three months of 2017.

Withdrawals. No Forms RW were filed in the last week of March, leaving the month with just two withdrawals. That is one more than was recorded in February, but is four fewer than the March 2017 total. As of March 31, five Forms RW had been filed this year compared to 18 in the same period last year.

The information reported here was gathered using IPO Vital Signs, a Wolters Kluwer Regulatory U.S. database that includes all SEC registered IPOs, including REITs and those non-U.S. IPO filers seeking to list in the U.S. markets. IPO Vital Signs does not track closed-end funds, best efforts or non-underwritten deals, or IPO offerings for amounts less than $5 million.

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