The Canadian market for initial public offerings (IPOs) struggled in 2012’s second quarter, with just two new issues on the Toronto Stock Exchange (TSX), according to a new PwC report.
PwC’s quarterly survey, released this morning, found that the two TSX issues had a total value of $185 million.
Both IPOs were real estate investment trusts (REITs).
Dean Braunsteiner, PwC national IPO services leader, attributed the slow IPO market to the European debt crisis, a global softening of commodity prices and resultant market volatility. He added that the controversial Facebook IPO failed to ignite interest in the technology sector during the quarter.
“The interest in REITs is testimony to the enduring appeal of the yields from real estate, and the single bright spot in the second quarter,” he said in a PwC news release. “But sagging commodity prices and the recent slide in the price of oil have made it very difficult for companies in those normally active sectors to plan new issues. Caution will be the watchword for the next few months.”
According to the PwC report, the TSX Venture had 12 IPOs registered in the second quarter, and the CNSX had five, with the 17 equity issues totalling $199 million.
The report noted that year-to-date, all Canadian exchanges recorded a total of 32 new issues generating $220 million in new equity, a significant drop from the first half of 2011, which saw 34 IPOs with a combined value of $1.4 billion.
