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  • A new report from consulting firm EY shows 2021 was an strong year for IPOs, with a 64 per cent jump in offers completed and a 67 per cent increase in proceeds
  • A total of 2,388 initial public offerings were completed during the year, raising a total of US$453.3 billion (A$631.3 billion) in proceeds
  • The fourth quarter of 2021 proved to be the most active quarter while technology proved to be the hottest sector globally, with 611 IPOs completed
  • Europe, the Middle East, Indian and African stock exchanges were the popular choice for debuting businesses, while the Asia Pacific region recorded modest growth
  • In Australia, IPOs rose 159 per cent and proceeds rose by 144 per cent in the fourth quarter, with deals increasing from 76 for the same period in 2020 to 197 in Q4

A new report from consulting firm EY shows 2021 was a strong year for IPOs, with a 64 per cent jump in offers completed and a 67 per cent increase in proceeds.

A total of 2388 initial public offerings were completed during the year, raising a total of US$453.3 billion (A$631.3 billion) in proceeds.

In Australia, IPOs rose 159 per cent and proceeds rose by 144 per cent in the fourth quarter, with deals increasing from 76 for the same period in 2020 to 197 in Q4.

“Like the rest of the world, the ASX IPO market had a stellar performance in the fourth quarter driven by the two largest IPOs of the year, GQG and APM,” Duncan Hogg, EY Oceania head of M&A said.

“Despite lockdowns and inflationary pressures, the equity markets have proven resilient throughout 2021 with IPO’s continuing to outperform. Market confidence is expected to continue into the New Year but with an overlay of caution given both economic and potential pandemic headwinds.”

“In addition to a strong IPO pipeline into 2022, M&A is expected to also drive secondary equity issuance to fund acquisitions. The recent CSL transaction is a case in point.”

“Technology and healthcare are expected to be the sectors underpinning 2022 equity markets performance.”

According to EY, the fourth quarter of 2021 proved to be the most active quarter around the globe with 621 deals completed – the biggest volume since Q4 2007.

Technology proved to be the hottest sector globally, with a total of 611 IPOs completed throughout 2021 for total proceeds of US$147.5 billion (A$205.4 billion).

Regionally, EY said Europe, the Middle East, Indian and African stock exchanges were the popular choice for debuting businesses with a 158 per cent jump in IPOs completed.

In comparison, the Asia Pacific region recorded more modest growth – with the volume of deals finished only rising by 28 per cent.

Looking ahead, the consulting firm is predicting IPO growth may slow as more COVID-19 variants emerge and spread in the community.

However, EY also noted that relatively high valuations and market liquidity may help the IPO market remain strong.

EY Global IPO Leader Paul Go said 2022 would essentially bring both COVID-19 tailwinds and headwinds.

“Whether IPO-bound companies press pause or forge ahead in 2022, they will need to satisfy investor demands for resilient growth strategies and well-articulated ESG plans,” he said.

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