By Liz Moyer
Wall Street's lucrative engine for initial public offerings picked up in 2024 but still lagged behind historical standards, according to a year-end look at the market by Renaissance Capital.
Companies postponed offerings amid interest rate uncertainty and market volatility. The banking industry is hopeful for a pickup in IPO and other business in 2025.
The 146 U.S. debuts in 2024 raised $29.6 billion. That has / that is a more than 50% increase in proceeds compared with 2024, but deal flow was still slow historically and skewed toward larger debuts, Renaissance Capital said. Some 58 of the IPOs raised $100 million or more, nearly double 2023's count.
Five firms raised $1 billion or more, led by cold storage REIT Lineage, which raised $4.4 billion, Renaissance said. Large IPOs of $100 million or more averaged a 26% return from their offering dates, compared with a 3% loss for the broader group of all 2024 IPOs.
Venture capital-backed tech deals picked up, Renaissance said. The difference between private market valuations and public markets kept many tech unicorns on the sidelines, but deals by social media site Reddit and others could be a sign of a resurgence ahead, the IPO research firm said.
Deals by special purpose acquisition companies, or blank check firms, stabilized this year. New SPAC issuances rose to 55, while merger activity dropped to 69, including the merger of Digital World Acquisition Corp. and Trump Media & Technology Group.
Some 210 firms filed for IPOs this year, boding well for the market in 2025. Already, there are 110 companies in the active pipeline that have filed or updated their filings in the past 90 days. By sector, industrials lead, followed by tech and consumer discretionary, Renaissance said.
Write to Liz Moyer at liz.moyer@barrons.com
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(END) Dow Jones Newswires
December 22, 2024 15:00 ET (20:00 GMT)
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