IPO Activity Returns to Pre-Recession Levels in Second Quarter

The economic deep freeze is thawing for IPOs on U.S. exchanges, according to a quarterly report issued today by the Ernst & Young accounting firm.

The number of companies in registration for an initial public offering increased to 140 during the three months that ended June 30, according to the latest the “Ernst & Young U.S. IPO Pipeline” study. That’s almost 24 percent more than the 113 companies that were registered during the same quarter last year, according to Ernst & Young’s data. Beneath story, I’ve put together a list of companies in the IPO pipeline for each Xconomy city as of June 30.

Ernst & Young says the 140 companies now in the lineup represent a potential total of $23.7 billion in estimated market valuation. That’s down from the $25.3 billion in total value during the same quarter last year, but the highest number of companies registered to go public since late 2007, when the financial crisis was beginning to engulf the U.S. economy. Just 28 companies were in registration at the end of the second quarter in 2009, one of the darkest periods of the recession.

A total of 42 companies went public on U.S. markets during the second quarter, a 13.5 percent increase over the 37 IPOs during the second quarter of 2010.

The warming trend is good news for the venture firms and other investors that view IPOs as a key way to keep the capital flowing to new companies, and to exit from startup companies with a return on their investments. Of the 140 companies in the IPO pipeline, venture capital firms back 40 percent, 31 percent are backed by private equity firms, and 23 percent are backed by both.

Technology-related IPOs accounted for 25 of the total companies in the pipeline at the end of the quarter, and they are trying to raise a total of $4.4 billion. The oil and gas industry was the next bigger sector, with 17 companies trying to raise a total of $4.6 billion. Other active sectors include financial companies, retail and wholesale, and diversified industrial products. Here’s a breakout of companies in the pipeline for each Xconomy city:

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Author: Bruce V. Bigelow

In Memoriam: Our dear friend Bruce V. Bigelow passed away on June 29, 2018. He was the editor of Xconomy San Diego from 2008 to 2018. Read more about his life and work here. Bruce Bigelow joined Xconomy from the business desk of the San Diego Union-Tribune. He was a member of the team of reporters who were awarded the 2006 Pulitzer Prize in National Reporting for uncovering bribes paid to San Diego Republican Rep. Randy “Duke” Cunningham in exchange for special legislation earmarks. He also shared a 2006 award for enterprise reporting from the Society of Business Editors and Writers for “In Harm’s Way,” an article about the extraordinary casualty rate among employees working in Iraq for San Diego’s Titan Corp. He has written extensively about the 2002 corporate accounting scandal at software goliath Peregrine Systems. He also was a Gerald Loeb Award finalist and National Headline Award winner for “The Toymaker,” a 14-part chronicle of a San Diego start-up company. He takes special satisfaction, though, that the series was included in the library for nonfiction narrative journalism at the Nieman Foundation for Journalism at Harvard University. Bigelow graduated from U.C. Berkeley in 1977 with a degree in English Literature and from the Columbia University Graduate School of Journalism in 1979. Before joining the Union-Tribune in 1990, he worked for the Associated Press in Los Angeles and The Kansas City Times.