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Still smarting from the lingering recession, the market for initial public offerings (IPOs) of new equity did not see a full recovery in 2009, according to a PricewaterhouseCoopers (PwC) survey.

The survey revealed that 2009 ended with 28 new issues on all Canadian exchanges for a total value of more than $1.8 billion, up from $682 million raised through 57 new issues in 2008.

A single $300 million new issue in the fourth quarter brought the total number of IPOs on the TSX in 2009 to four, with a total value of $1.75 billion, up from $547 million in 2008.

According to Ross Sinclair, national leader of PwC’s Income Trust and IPO Services, three IPOs of $300 million or more on the TSX during 2009 suggest there is a lot of room for quality new issues in 2010.

“There wasn’t an abundance of activity during the year, but the larger issues certainly tested the market’s appetite for new equity, and the appetite is there,” he says. “The market is ready for new issues; the new issues just aren’t ready for the market yet.”

Sinclair sees the key ingredients in place for a meaningful recovery in 2010.

“An IPO market of $1.8 billion is not what we would expect for Canada at this stage of a recovery,” he says. “With the fundamentals falling into place, an annual IPO market of $4 billion is not out of the question. The volume of secondary equity offerings as ‘bought deals’ speaks to investor confidence. Rising valuations, improved liquidity, more stable markets, better pricing and credit spreads will also help.”

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Canada plans euro bond issue

Federal Finance Minister Jim Flaherty has announced plans to issue a euro-denominated global bond in the near future, subject to market conditions.

The move would be the government’s second foreign currency bond issue of the fiscal year, after a 5-year US$3 billion global bond issue in September 2009. The government says the proceeds of the bond issue will help to diversify its sources of foreign currency financing for its foreign exchange reserves.

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RBC rebrands Voyageur

Voyageur Asset Management has changed its name to RBC Global Asset Management (U.S.) Inc., effective December 31, 2009.

“Our new name reflects our shared values with RBC GAM, which reinforces our commitment to providing consistent investment excellence and exemplary client service to our clients in everything we do,” said Mike Lee, CEO, president and chief investment officer of RBC GAM (U.S.). “We are proud to bring the strength and stability of RBC and RBC GAM to our clients. As part of the RBC GAM platform, we look forward to offering clients an expanded array of investment solutions in the coming months.”

RBC GAM is made up of Royal Bank of Canada’s three asset management firms: RBC GAM (U.S.), RBC Asset Management Inc., and Phillips, Hager & North Investment Management Ltd.

(01/05/10)