Equity issuance rises in Q3: IIAC

The value of Canadian stock issuance rose dramatically in the third quarter, but much of the increase was due to a single large issuer, according to the Investment Industry Association of Canada (IIAC).

Total issuance value for Q3 topped $15.2 billion, more than double the sum raised on capital markets in the same quarter of 2008. Of that total, $4.3 billion was raised by Barrick Gold.

Other notable offerings included Genworth MI Canada ($945.7 million) and Brookfield Properties ($556.8 million).

So far this year, equity financings have totaled $44 billion, and 2009 is shaping up to surpass the record of $55 billion set in 2007. There were 734 equity offerings were completed in Q3, with 84% of these deals raising less than $10 million. These small deals accounted for less than 4% of capital raised.

Secondary offerings made up 69% of the total raised, while initial public offerings raised $1.5 billion, marking the highest total since Q4 of 2007.

Common shares made up $12.2 billion of the total, marking a 37% increase from the second quarter.

While the majority of the capital raised was in the form of common equity, preferred share issues raise $1.3 billion, while limited partnerships accounted for about $100 million.

Private placements totaled $2.2 billion, up from $1.2 billion from last quarter. Income trust issuance fell to $1.5 billion on 13 offerings, down 37% from Q2.

The IIAC report projects the final quarter of the year will see continued strength, as equity markets have continued their upward trajectory.

(11/30/09)

Staff

The staff of Advisor.ca have been covering news for financial advisors since 1998.