Skip to main content

Andrew Masterman, CEO of BrightView Holdings, rings a ceremonial bell to begin trading of his company’s stock during its IPO on the floor of the New York Stock Exchange on June 28, 2018.

BRENDAN MCDERMID/Reuters

Rising energy prices are expected to breathe some life into the market for initial public offerings, after political uncertainty weighed on executives and made for a sluggish start to the year.

Only seven initial public offerings came to market in the first six months of 2018, raising a total of $958.5-million, according to quarterly data from Thomson Reuters. That compares with 12 IPOs, raising a combined $3.6-billion, during the first half of 2017.

The biggest deal so far was a $241.7-million raise by MAV Beauty Brands Inc., the data show.

Story continues below advertisement

“It’s been a very slow year,” said Peter Miller, head of Canadian equity capital-markets at BMO Nesbitt Burns.

Many Canadian executives have been reluctant to take on risky capital projects or make big acquisitions, Mr. Miller said.

"Uncertainty about trade and NAFTA seems to be weighing on the minds of Canadian executives, and as a result there’s been a long pause as far as issue activity,” Mr. Miller said.

Over all, equity issuance totalled $16.9-billion – a 36-per-cent drop compared with the first half of 2017. BMO was the top underwriter of stock sales, followed by TD Securities and CIBC World Markets.

Sante Corona, head of equity capital markets at TD Securities, blames the decline on decreased activity by the energy sector. Last year, energy companies – including oil and gas producers, pipelines and utilities – were responsible for $13-billion of issuance in the first half of the year, Mr. Corona said. This year, they have only raised $1-billion so far.

But higher oil prices – the U.S. crude benchmark cracked US$75 a barrel on Monday for the first time since November, 2014 – provide some optimism for the remainder of the year.

“We are having dialogue with numerous companies in the energy sector that, if things continue to go well, could come to market,” Mr. Miller said.

Story continues below advertisement

In the absence of energy and mining deals, Mr. Miller said the cannabis sector has been “a bit of a saving grace” for BMO, which helped Canopy Growth Corp. sell $600-million worth of convertible debentures last month.

Kirby Gavelin, head of equity capital markets at RBC Dominion Securities, said he expects more publicly traded companies to tap the public markets to finance acquisitions in the latter half of the year. He also anticipates “meaningful activity” in the IPO market, across a broader range of sectors.

“So we’re pretty constructive as we look forward for the next six months of 2018,” Mr. Gavelin said.

Top banks for equities (excluding self-led deals)

RankCompanyAmount raised ($ billions)Number of Issues
1BMO Nesbitt Burns1.827
2TD Securities1.725
3CIBC World Markets1.423
4National Bank Financial1.226
5RBC Dominion Securities1.118

Source: Thomson Reuters


Top banks for corporate debt (excluding self-led deals)

RankCompanyAmount raised ($ billions)Number of Issues
1RBC Dominion Securities9.853
2TD Securities6.836
3CIBC World Markets6.734
4BMO Nesbitt Burns4.626
5Scotia Capital3.922

Source: Thomson Reuters


Top banks for M&A (any Canadian involvement announced)

RankAdviserValue of deals (in US$ billions)Number of Deals
1Goldman Sachs44.012
2Bank of America Merrill Lynch42.110
3TD Securities35.124
4Citi28.411
5Morgan Stanley28.310

Source: Thomson Reuters

Report an error Editorial code of conduct
Comments

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff.

We aim to create a safe and valuable space for discussion and debate. That means:

  • All comments will be reviewed by one or more moderators before being posted to the site. This should only take a few moments.
  • Treat others as you wish to be treated
  • Criticize ideas, not people
  • Stay on topic
  • Avoid the use of toxic and offensive language
  • Flag bad behaviour

Comments that violate our community guidelines will be removed. Commenters who repeatedly violate community guidelines may be suspended, causing them to temporarily lose their ability to engage with comments.

Read our community guidelines here

Discussion loading ...

Due to technical reasons, we have temporarily removed commenting from our articles. We hope to have this fixed soon. Thank you for your patience. If you are looking to give feedback on our new site, please send it along to feedback@globeandmail.com. If you want to write a letter to the editor, please forward to letters@globeandmail.com.
Cannabis pro newsletter