Canadian businesses raised $28.7-billion in stock from 149 issues in the first half of the year, excluding self-funded deals, according to data complied by Thomson Reuters.Getty Images/iStockphoto
During a year in which share sales around the world have fallen off a cliff, activity in Canada has held up, thanks in large part to several big offerings.
In the first six months of 2016, the total value of share issues by companies around the world comes to about half of what they raised during the same period last year. In Canada, however, issuers have raised almost as much as they did at this time in 2015 – just 5 per cent less.
Canadian businesses raised $28.7-billion in stock from 149 issues in the first half of the year, excluding self-funded deals, according to data complied by Thomson Reuters. In 2016, equity issuance in Canada slipped 6 per cent in the second quarter from the first.
The energy and power sector posted equity proceeds of $19.5-billion, accounting for 68 per cent of all shares sales. The materials industry captured a 14-per-cent share, with $3.9-billion in proceeds, while financials came in third, with a 4-per-cent share of the market.
In March, TransCanada Corp. had the country's largest share issuance, raising $4.4-billion in a bought deal, meaning the investment banks leading the issue bought the shares up front and then attempted to sell them to third-party investors. Suncor Energy Inc. had the second largest at $2.9-billion in June and Enbridge Inc. the third at $2.3-billion in February.
RBC Dominion Securities was the top underwriter of $5.9-billion in stock sales, excluding work on its own deals, while TD Securities Inc. placed second and CIBC World Markets Inc. ranked third.
New corporate listings, in contrast, have been stuck in a drought. June marked the eighth straight month without any Canadian initial public offerings exceeding $5-million, according to Thomson Reuters. This streak ties the period from August, 2008, to March, 2009, when U.S. equity markets were collapsing and Canada's followed suit.
A steady flow of IPOs helps to keep the country's equity markets turning. But IPOs of fledgling companies all but dried up during the first six months of the year.
Mergers and acquisitions have also slowed in the first half of the year to $108.2-billion (U.S.) in 1,160 transactions compared with $137.9-billion in 1,255 deals during the same six-month period in 2015. So far in 2016, the top three transactions by value saw tie-ups between Canadian buyers and U.S. targets: TransCanada announced its $12-billion purchase of Columbia Pipeline Group Inc.; Fortis Inc. said it agreed to buy ITC Holdings Corp. for $11.1-billion; and Progressive Waste Solutions made a deal to acquire Waste Connections Inc. for $8.1-billion.
Foreign banks dominated the league tables for M&A measured by transaction value, with Goldman Sachs & Co., Barclays and Lazard Ltd. rounding out the top three. Simpson Thacher & Bartlett LLP, Osler Hoskin & Harcourt LLP, and Blake Cassels & Graydon LLP were the three highest-ranking law firms by deal size. The firms advised on seven, 42 and 40 transactions, respectively, that included some Canadian involvement.
National Bank Financial was the busiest bank for debt underwriting, excluding self-funded deals, helping clients to raise $16.5-billion (Canadian) in debt.
Editor's note: The following tables have been updated to reflect changes in the data provided by Thomson Reuters.