* Global ECM falls 30 pct to $463 bln YTD
* Global IPO volume down 34 pct to $79 bln YTD
* JP Morgan tops global league table
By Dasha Afanasieva
LONDON, Sept 30 Global equity fundraising rose
in the third quarter, Thomson Reuters data showed on Friday, but
failed to make up for the sharp slowdown of the first half of
2016, when volatile markets deterred listings.
Equity fundraising worldwide fell 30 percent to $463.5
billion in the year to date. Bankers said a robust pipeline of
deals may improve conditions over the next two quarters but
equity fundraising is unlikely to reach levels seen last year.
Money raised from flotations, or initial public offerings
(IPOs), fell more than a third to $79.2 billion in the first
three quarters, the slowest such period since 2009, Thomson
Reuters Equity Capital Markets (ECM) data showed.
Bankers said deals which could not be done earlier in the
year because of choppy market conditions saw their window in the
last few months, resulting in an unseasonably busy third
Achintya Mangla, head of EMEA ECM at JP Morgan in London,
said investors had become more comfortable with Britain's
decision to leave the European Union, and with the outlook of
the U.S. Federal Reserve and the stable conditions across
"It's not a bull market but it's a constructive market with
a lot of liquidity which investors are keen to deploy into the
right equity story and at the right price," he said.
"It's not a market you can take for granted. Volatility
could return and investors will monitor the trading performance
Global markets were on track for their biggest
quarter-on-quarter boost for five quarters, compared to a
decline in the first three months of the year.
Worries about a slowdown in China, the world's second
biggest economy, and falling oil prices which hit $27 a barrel
in January, made for a volatile first quarter with investors
wavering between calm and panic.
In June the British vote to leave the EU heaped on
additional volatility and spooked some companies hoping to tap
Bankers said some listings which could not be done then were
postponed to August and September.
Professional services firm EY saw a healthy pipeline of
deals for the remainder of the year and the start of 2017, with
improved political stability and greater clarity over Brexit
negotiations holding the key to a pickup in IPO activity.
In the final days of the quarter, a $7.4 billion IPO of
Postal Savings Bank of China made a flat debut in Hong
Kong as worries over the health of the banking sector squeezed
The IPO was the biggest in two years and drove a more than
five-fold increase in the value of IPOs in China in the quarter.
The demand for shares in Nets, issuer of Denmark's
most used debit card, exceeded expectations last week but closed
5 percent below its offer price on Thursday.
The tech business was valued at $4.5 billion, nearly double
what Advent International, Bain Capital and pension fund ATP
paid for it two years ago.
Bolstered in part by a $4.1 billion convertible bond issue
for Vodafone in February, JP Morgan came out top
of the league table for equity offerings. It was also the top
bookrunner on IPOs globally.
"Markets are constructive right now and investors are
willing to put money to work but they are selective and
disciplined on price. There are events on the horizon [U.S
election for example] which could cause market volatility so we
would advise to clients to do deals now if it makes sense," JP
Morgan's Mangla said.
An IPO of British mobile unit O2 by Spain's Telefonica
is expected to be one of the biggest listings in London
later this year, with the group expected to take advantage of
the relative market calm following the Brexit vote.
The firm has hired UBS, Morgan Stanley and
Barclays as global coordinators for the listing, which
could value O2 at about 10 billion pounds ($13 billion).
Bankers said they had a robust stream of equity raising
deals coming up, but no bank was likely to see the business
pipeline of 2014-15, when a season of private equity exits
helped keep ECM bankers busy.
With the U.S. elections in November, a referendum on
constitutional reform in Italy in December and the triggering of
Britain's formal divorce proceedings from the EU expected early
next year, there remain opportunities for market swings.
But Gareth McCartney, EMEA Head of Equity Syndicate at UBS,
said there was more clarity with respect to macroeconomic
events, with some questions critical to geopolitical and market
stability about to be addressed.
"We are now in a sweet spot where we have visibility on the
macro front, ahead of the upcoming U.S. elections and clarity on
the Italy referendum. We are in the middle of the best part of
the year for executing transactions," he said.
"It will be a slow burn, a lower volatility environment,
which should allow for greater issuance."
(Reporting by Dasha Afanasieva; Editing by Mark Trevelyan)