US ECM activity in Q1’22 declined for the 4th consecutive quarter following record issuance in Q1’21.
- Including SPACs, 217 offerings raised $40.2B
- Q1’22 marked the first quarter over quarter reduction in proceeds raised of more than 50% since Q3 of 2015
- For comparison, the average weekly activity in 2021 was 29 offerings vs. 12 YTD
- Excluding SPACs, 38.9% of offerings priced were $25M or less and 46.9% were $50M or less
- Average Q1’22 IPO size fell 75% from $363.5M in FY’21 to $90.8M YTD (vs. median deal size of $16.0M)
- Average Q1’22 registered follow-on size fell 27.9% from $274.2M to $197.8M YTD (vs. median deal size of $69.0M)
- TPG Inc. successfully raised $1,100.1M, accounting for 44.0% of total Q1 22 IPO proceeds
- SPAC issuance accounted for more than 4x the proceeds raised by traditional IPOs
Q1 Trends
- Including Unregistered Block activity tracked by CMG, Q1 transaction volume dropped to $30.2B, a 79.5% decrease year over year and a 66.4% decrease from the prior quarter (excluding SPACs)
- IPOs raised $2.5B, representing a 94.4% decrease over the same period last year via 27 offerings, while follow-on issuance raised $27.7B representing a 73.4% decrease over the prior year via 135 offerings
- Financial Services took over as the most active sector raising $6.4B (21.3% market share) followed by Healthcare $4.3B (14.4% market share) and Real Estate $4.3B (14.2% market share)
- On a dollar-weighted basis, IPOs returned 19.7% from offer to first day close (vs. a mean of 51.9%) and returned 4.7% from offer to current (vs. a mean of 4.0%)
- On a dollar-weighted basis, registered follow-ons returned 1.3% from offer to first day close (vs. a mean of (4.4%)) and returned (2.5%) from offer to current (vs. a mean of (2.2%))
FY 2021 vs. Q1 2022 Dollar-weighted One-day Returns
IPOs
24.2% vs. 19.7%
SPACs
2.6% vs. 0.1%
Marketed FOs
2.9% vs. 1.9%
Overnight FOs
5.1% vs. 2.0%
Registered Blocks
0.6% vs. (0.2)%
Unegistered Blocks
0.5% vs. (2.9)%
Largest Q1 Dollar-weighted Alpha Contributors: 1-Day
Yoshitsu Co., Ltd
01/07/22
$25.0M IPO +700.0%
TPG Inc.
01/12/22
$1,100.1M IPO +15.3%
Blue Water Vaccines Inc.
02/11/22
$20.0M IPO +537.8%
Largest Q1 Dollar-weighted Alpha Contributors (To Current)
Intra-Cellular Therapies Inc
01/04/22
$460.0M Marketed FO + 49.2%
Blue Water Vaccines Inc.
02/11/22
$20.0M IPO +588.0%
Credo Technology Group Holding Ltd
01/26/22
$230.0M IPO + 44.2%
SPAC Issuance
- Q1 2021 – 298 offerings raised $98.1B with an Avg. deal size of $329.1M
- Q2 2021 – 64 offerings raised $13.9B with an Avg. deal size of $217.9M
- Q3 2021 – 88 offerings raised $17.4B with an Avg. deal size of $197.3M
- Q4 2021 – 163 offerings raised $33.1B with an Avg. deal size of $202.8M
- Q1 2022 – 55 offerings raised $10.0B with an Avg. deal size of $182.2M
IPO Vs. Follow-On Composition as a % of Proceeds Raised: FY 2021 Vs. Q1 2022
IPOs
35.0% vs. 8.1%
FOs
65.0% vs. 91.9%
Follow-On Composition as a % of Proceeds Raised: FY 2021 Vs. Q1 2022
Marketed FOs
42.2% vs. 20.4%
Overnight FOs
11.3% vs. 22.4%
Registered Blocks
24.5% vs. 19.2%
Unregistered Blocks
22.0% vs. 38.0%
Discount Trends (Mean File to Offer): FY 2021 & Q1 2022
Marketed FOs
(13.5%), (25.8%)
Overnight FOs
(13.8%), (16.5%) vs. FY21 & Q1 2022 % to VWAP of: (14.1%), (17.3%)
Registered Blocks
(6.8%), (7.3%) vs. FY20 & Q1 2021 % to VWAP of: (7.0%), (7.0%)
Unregistered Blocks
(3.4%), (4.3%) vs. FY20 & Q1 2021 % to VWAP of: (3.8%), (4.2%)
This information provided is for informational purposes only, and should not be construed as legal, tax, investment, financial, or other advice. You should not act or refrain from acting on the basis of any of this information. Past performance is no guarantee of future results. CMG shall have no liability whatsoever for your use of this information.
