30 January 2019

Asia Pacific 2018 IPO roundup

When considering initial public offerings (IPOs) by targets based in Asia Pacific that were announced in 2018, you would be forgiven for focusing on multi-billion-dollar listings by the likes of China Tower, Foxconn, Softbank and Xiomi. In fact, Zephyr, the M&A database published by Bureau van Dijk, shows companies headquartered in Asia Pacific accounted for seven of the top ten IPOs by value announced last year - though the majority of these listings were carried out via offshore incorporated vehicles. In addition, Zephyr shows Asia Pacific was the top region by aggregate value of IPOs in 2018, more than one and half times the total value of IPOs announced or completed by companies based in Western Europe.

However, back to the matter at hand: what about first-time share sales by companies based in countries such as Malaysia, Thailand, Vietnam, Indonesia or Singapore? They have been deliberately written in this order as it is the way they appear in the top country by IPO value in 2018 and note Singapore’s position – last – as the aggregate value of listings targeting a Singaporean company announced in 2018 fell to one of the lowest on record, USD 925 million. In contrast, Vietnam’s privatisation drive and reforms propelled aggregate value of IPOs by local companies to the second-highest on record (2018: USD 2,271 million; 2007: USD 2,492 million).

Highlights of the IPOs by Singaporean companies last year include Summit Power International announcing plans to raise USD 245 million and, in terms of completed listings, Sasseur Real Estate Investment Trust debuting in March after selling a 15.9 per cent stake for USD 163 million. Some local players decided to try their hands at an overseas float as Zentosa Capital gaining admission to Mauritius’ board and Kinergy raising USD 31 million in Hong Kong. 

Indonesia overtook Singapore by value, helped by the fact that 58 of the 64 IPOs announced during the year had a known value which aggregated to a total USD 1,107 million due to prolific first-time share sales being announced, though they were each worth less than USD 100 million. Bank BRISyariah accounted for the largest after floating a 27 per cent stake in May to raise USD 95 million.

Conversely, the volume of IPOs by Vietnamese companies announced over the 12 months was less than that of Indonesia, but value growth was driven by two deals with a known value: Vinhomes sold a 10 per cent stake for USD 1,350 million in May and Vietnam Technological and Commercial offered 14 per cent for USD 921 million. Total value represented the second-highest recorded, after USD 2,492 in 2007.

With regards to prospects in 2019, EY remains on the fence as it believes the Asia Pacific IPO market has “reached a crossroads” and depends on fundamental actors, such as geopolitics, trade relations and liquidity, so watch this space.

© Zephyr