Initial public offerings

For everyone involved in the public company D&O arena, IPOs are a continuing source of interest and concern. An important part of thinking about IPO companies and their D&O risk profile in understanding what is going on in the IPO marketplace. On March 6, 2019, the Proskauer Rose law issued its annual analysis of the 2018 U.S. IPO activity. The report provides an interesting overview of the important characteristics of 2018 IPOs. The IPO report can be found here. The law firm’s March 6, 2019 press release about the report can be found here.
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Between 1996 and 2016, the number of U.S. listed companies declined by about 50 percent. There are now fewer U.S. listed companies than there were in 1976. Some observers have raised the alarm about this decline. For example, SEC Chair Jay Clayton in a speech last summer called the decline in the number of U.S. listed companies “a serious issue for our markets and the country.” But before we can decide whether or not the lower number of public companies is a problem, much less what to do about it, we need to take a look at what is happening and why it is happening. A closer look suggests that the situation is more complex than it might appear at first glimpse.
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stockboardAlthough the IPO pace is off from last year’s sizzling levels, the number of companies completing IPOs on U.S. exchanges remains at heightened levels. In addition, the number of completed IPOs picked up as the year progressed, suggesting that IPO activity in the U.S. in the year’s second half will also be lively.

U.S.  IPO activity in 2014 was at the highest levels in more than a decade, when there were a total of 275 U.S. IPOs (as discussed here). According to Renaissance Capital (here), through the first six months of 2015, there have been a total of 104 completed IPOs, which is well below the 147 completed in the first half of 2014 (representing a decline of 29%). However, other than when compared with 2014, the number of U.S. IPOs completed in the first half of 2015 is the first half total since 2004.

The pace of completed IPOs has picked up as 2015 has progressed. The number of U.S. IPOs completed in June 2015 was the highest monthly total since July 2014, and the number of IPOs completed during the week ending on June 25, 2015 was the highest weekly total since October 2014, as discussed here. Moreover, the market for IPOs appears to be quite healthy as we head into the year’s second half. Seres Therapeutics, which debuted during the week ending June 25, 2015 soared 186% on its first day of trading, the highest post-IPO pop since January 2014.
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ey2014 was a very strong year for IPOs globally, but in the U.S., where there were more IPOs this year than any year since 2000, this was an “exceptional” year, according to the latest quarterly global IPO report from accounting and consulting firm EY. The report, entitled “EY Global IPO Trends: 2014 Q4” can be

tockertapeAll eyes may be on the record-setting IPO of Chinese Internet firm, Alibaba, but the real IPO story for 2014 may be the significant number of IPOs this year involving smaller companies. The number of companies completing IPOs this year  is on pace for the highest annual level since 2007, a surge in initial public

roadDue to a combination of favorable circumstances, the number of companies completing initial public offerings is currently at the highest level in years. According to a recent study from Cornerstone Research (here), with the 112 IPOs in the first half of 2014, IPO activity is on pace to increase for the third consecutive