U.S.-Listed IPOs on Track to Raise the Most Money Since 2014

Wall Street Journal writers Maureen Farrell and Corrie Driebusch reported on Monday that, “A whipsawing stock market could mean a bumpy path to public markets in 2019 for some of the fastest-growing and most richly valued private companies ever, but it isn’t currently expected to derail them.

“Stock markets that have sold off sharply in recent months have been even more in tumult, thrashing up and down as the year ends. The Dow Jones Industrial Average notched its worst Christmas Eve ever and then logged the biggest point gain in its history the next trading day. In the past three months, the S&P 500 has fallen 15% and the technology-laden Nasdaq is off 18%.

Those declines are threatening to bleed into a 2019 that many anticipate could be a record-breaking year for initial public offerings in terms of money raised. A host of big-name tech companies for whom public investors have been waiting years, including Uber Technologies Inc., Lyft Inc., Pinterest Inc. and Slack Technologies Inc., is preparing for stock-market debuts as soon as the first half of next year.”

“IPO-Hungry Investors Look to Have Their Moment in 2019,” by Maureen Farrell and Corrie Driebusch. The Wall Street Journal (December 31, 2018).

The Journal article noted that, “Rajeev Misra, the chief executive of SoftBank’s $100 billion Vision Fund, says he expects the public markets to be a key source of future capital for the more than 70 companies his firm has invested in. In the second half of 2019, he expects one of the fund’s portfolio companies to go public each month on average.

“‘The IPO market is robust,’ he said, even in the face of the recent selloff and volatility.”

Monday’s article added that, “But there is no guarantee 2019 will break records, especially if stocks continue to sell off and swing wildly. As stock prices fall, share sales become less attractive to issuers, who naturally want to maximize proceeds. Lower prices aren’t always embraced by potential investors either, as they fear missing out on the opportunity to participate in a quick run-up they can cash in on.

“Still, advisers to many of the pre-IPO companies say their preparations continue. Either way, IPO experts don’t envision a smooth ride.”

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