Global IPO market activity is expected to
continue to grow in 2011, according to a report by Ernst &
Young (E&Y).

The report, Global IPO trends 2011,
found the key drivers of the global IPO market this year have
continued to grow from last year for emerging markets,
state privatisations, multinational company spin-offs and companies
in the energy, industrial, materials and technology sectors.

Ernst & Young also found companies are
ramping up their capitalisation to record levels mainly to support
future acquisitions, which is a reflection of growing investor
confidence around equity valuations and sharpened risk

Geographical highlights expected in 2011

  • In Asia, China is set to maintain its
    five-year-long leadership of global IPO markets with Hong Kong
    expected to remain the world IPO leader and raise more than US$50
    bn in 2011;
  • In the Americas, the US has a growing backlog
    of about 150 companies which are expected to raise around US$40
    billion. These include private equity, venture capital backed
    companies, fast-growth companies in technology, health care and
    real estate, companies based in China, large company spin-offs and
    US companies backed by money from the Troubled Asset Relief
    Program; and
  • In Europe, the UK pipeline of potential IPO
    candidates remains strong. Numerous cross border listings on the
    London Stock Exchange are expected, most notably from emerging
    market-facing companies. Europe’s financial institutions, including
    spin-offs from over-leveraged banks, could be the source of the
    largest IPO prospects.

In the Middle East and Africa, E&Y reports
the IPO outlook remains dim as many companies are wary of listing
discouraged by “poor valuations, sluggish GDP growth prospects and
political unrest.”