IPO market sees post-2000 record in second quarter as tech enjoys most active quarter in two decades
The U.S. initial public offering market saw 113 deals in the second quarter, making it the most active since 2000, according to Renaissance Capital, a provider of institutional research and IPO ETFs. And with IPO returns rebounding and a large and growing pipeline, the market is expected to be active in the third quarter as well. New issuers raised a total of $39.9 billion in the latest quarter, the biggest sum ever for a second quarter. The market saw average returns of 34%, driven by first-day pops in prices. Healthcare accounted for the most issuance, but it was the busiest quarter for tech IPOs in at least two decades, Renaissance CEO and co-Founder Bill Smith said in emailed comments. “The year’s record-breaking pace of billion-dollar IPOs continued with Chinese ride-hailing giant DiDi
oat milk brand Oatly
and app software maker AppLovin
” said Smith. The trend surrounding special purpose acquisition corporations, or SPACs, blank-check companies that raise money in an IPO and then look to acquire a business or businesses, slowed significantly from previous quarters. SPACs became a highly popular way to go public during the pandemic year of 2020, setting records for number of deals and amount raised. But investor fatigue and growing scrutiny from regulators dampened enthusiasm for the vehicle, although merger announcements continued, said Smith. The Renaissance IPO ETF finished the quarter up 4% and is up 2% in the year to date, while the S&P 500
has gained 9%.