* Worldwide equity fundraising up 36 pct to $380.7 bln in H1
* Goldman Sachs tops global equity capital market rankings
* U.S. accounts for more than a third of activity
* Return of choppy markets clouds outlook
By Kylie MacLellan and Olivia Oran
LONDON/NEW YORK, June 28 Global equity
fundraising rose 36 percent year-on-year in the first six months
of 2013, supported by improving stock markets, though recent
losses have put a question mark over a string of deals expected
after the summer lull.
Volatility has spiked in the past few weeks, triggered by
concerns the Federal Reserve may trim back its stimulus policies
and worries about a weaker Chinese economy, already prompting
some companies to scrap stock market debuts or cut offer prices.
Last week Brazilian cement company Votorantim Cimentos
postponed its $3.7 billion U.S. listing, while on Wednesday
industrial and construction supplies company HD Supply Holdings
raised less than expected from its market debut.
For now however, with the typically quieter summer period
approaching, bankers said preparations are continuing for
businesses planning to come to market later in the year.
"The markets have been more volatile the last few weeks.
We'll have to wait and see whether it settles down or if this is
the start of a more negative period. I think it is more likely
to be the former," Ken Brown, Global head of Equity Capital
Markets (ECM) at Nomura, told Reuters.
"There are a lot of transactions to come post-summer.
Preparations are well underway on those deals, so it would take
a lot more than a few bad days to suspend those efforts."
A total of $380.7 billion was raised worldwide from share
sales in the first half of the year, Thomson Reuters data showed
on Friday. Activity was dominated by the United States, which
accounted for 35 percent all issuance.
Goldman Sachs, which was involved in some of the
biggest deals of the first half such as Dutch telecoms group
KPN's 3 billion euro rights issue, topped ECM
investment banking league tables globally. JP Morgan
followed in second place, with Morgan Stanley in third.
Just over 70 percent of money raised came from follow-on
offerings, as companies and their owners took advantage of
strong equity markets to raise extra funds or exit stakes.
Bank capital hikes such as Deutsche Bank's $3.9
billion share sale and a $3.3 billion offering by Russia's VTB
, helped to make financials the most active sector.
Real estate was the second busiest area as investors looking
to take advantage of the recovering U.S. housing market flocked
to offerings from companies such as home builder William Lyon
Homes, while Europe's biggest listing of the year so far
came from German real estate group LEG Immobilien.
ALL EYES ON U.S. FED
Initial public offerings (IPOs) globally were up 4 percent
on last year, with Europe in particular seeing a strong rebound
as investor worries over the euro zone sovereign crisis subdued.
At $10.2 billion, the volume of new listings in Europe was
more than double the same period last year.
"The attractive valuations of European equities has seen
more American investors putting money into Europe. Inflows into
equities and lower volatility earlier this year have also
helped," said JP Morgan co-head of EMEA ECM Klaus Hessberger.
Many of the deals on both sides of the Atlantic were private
equity exits, such as Cinven's flotation of life insurer
Partnership Assurance in London and drug research firm
Quintiles Transnational Holdings flotation in New York.
"We're seeing a diverse business mix of tech, industrials,
energy, financial services and healthcare all with very high
levels of activity," said Jeff Bunzel, Deutsche Bank's head of
ECM for the Americas. "We're not just dependent on one sector."
In contrast, Asia Pacific has seen a drop off in new
listings with issuers from the region representing the lowest
year-to-date share of the global IPO market since 2002.
Overall, equity issuance in Asia ex-Japan rose 5 percent in
the first half to $86.8 billion, as a boom in Thailand,
Philippines and other Southeast Asian markets offset a decline
in regional powerhouses Hong Kong and China.
Upcoming deals such as China Everbright Bank's up to $2
billion Hong Kong listing and an up to $3.3 billion offering by
Manila Electric will be largely dependent on more stable markets
and visibility on U.S. rates, bankers said.
"There's a very large pipeline of transactions across the
region looking to launch once there is some stability in the
market," said Chito Jeyarajah, chief operating officer of ECM,
Asia ex-Japan, at Goldman Sachs in Hong Kong.
Many of the large U.S. deals expected later this year are in
the energy and real estate sectors, including Empire State
Realty Trust, energy company Antero Resources and real estate
investment trust American Homes 4 Rent.
"Our general advice to companies is to go," said Frank
Maturo, vice chairman for ECM at Bank of America Merrill Lynch.
"Although volatility has picked up, it's more about macro
concerns, including currency depreciations and weakness in
emerging markets, versus company fundamentals."