Will good things come to those who wait?
In total, we estimate that as much as $7.0 billion that could have been raised in the 4Q15 from high-profile IPOs (mostly large LBOs) has now been pushed back to 2016. This has contributed to 2015 being the lowest year for new capital raised in the IPO market since 2009. Some companies, like Albertsons (ABS), have opted to wait for a market that will accept their targeted valuations; others, like Petco (PETC.RC), have already turned to private alternatives.
With recent weakness in retail, companies that typically have higher sales in the fourth quarter, like Vizio (VZIO) and At Home Group (HOME) are almost certain to hold off their plans until after the new year when they have a clearer picture of their 4Q15 results. Luxury department store chain Neiman Marcus Group (NMG) announced in October that it would delay its IPO until 2016 due to market volatility, presaging a plethora of weak data points out of the retail sector.
In light of the recent market backdrop, other large LBOs and PE-back firms no longer appear likely in the 4Q15, such as McGraw-Hill Education (MHED), Univision (UVN) and Laureate Education (LAUR). Even growth names like SoulCycle (SOUL.RC) have likely written off 2015 as their target date, hoping for a more receptive audience in the 2016. Dropbox appeared to be gearing up for a 2015 IPO with a CFO hire in February, but its private valuation has recently been called into question by investor mark-downs. BATS recently announced plans for a 2016 IPO.
| IPOs likely pushed to 2016 | ||||
| Neiman Marcus Group (NMG) |
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| Leading luxury department retailer that operates 43 full-line stores in the US. |
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| Laureate Education (LAUR) |
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| Largest for-profit higher education company. |
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| Univision (UVN) |
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| Leading American Spanish-language media company. |
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| Albertsons (ABS) |
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| Third-largest US grocer operating under Albertsons, Safeway and other banners. |
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| McGraw-Hill Education (MHED) |
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| Apollo-backed academic publisher spun out of McGraw-Hill Financial. |
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| Vizio (VZIO) |
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| Low-cost manufacturer of TVs and soundbars. |
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| SoulCycle (SOUL.RC) |
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| Indoor cycling fitness chain, spun out of Equinox, with 44 locations. |
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| At Home Group (HOME) |
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| Operates 94 home decor stores in the South and Midwest. |
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| Dropbox |
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| Web-based cloud storage provider. |
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| BATS Global Markets |
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| Operates equities and options exchanges in the US and Europe. |
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| Source: IPO ETF manager Renaissance Capital |
The data found in this post is an excerpt from Renaissance Capital's December 2015 IPO Preview, available only for subscribers of our institutional IPO research platform. Renaissance Capital manages two IPO-focused ETFs, which hold a market cap-weighted basket of recent initial public offerings from the US (NYSE: IPO) and internationally (NYSE: IPOS).
