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IPOs in America raise hopes in Frankfurt

F.Stronger price expectations for two large American stock exchange candidates are heating up the mood on the capital market there – while the market in Germany remains weak and experts are clinging to hopes for projects in the coming year. High market valuations drive expectations, but in this country official stock exchange plans often turn out to be option B – in the end the owners prefer to sell directly.

In America, the accommodation broker Airbnb and the food delivery company Doordash are putting out exclamation marks with their upcoming walk on the floor. They have just increased the price ranges, combined they are targeting revenues of more than $ 6 billion. According to data from the financial data service provider Bloomberg, this will lead to the strongest December that American stock exchanges have seen so far in terms of new additions (short: IPOs, Initial Public Offerings). And according to the data, the year so far has already brought a record, namely 156 billion dollars.

An amazing result in the crisis year Corona. The American equity market is more resilient, as one sees “still across the cycle,” judges Joachim von der Goltz, who heads the equity market business in Northern Europe at Credit Suisse. He also refers to the trend towards “Spacs” in the United States, that is, listed covers that are intended for later takeovers. “Here, the issue volumes have more than quadrupled compared to previous years.”

America top, Germany flop

The situation in Germany is completely different: After a weak year 2019 with four newcomers on the floor, this year hardly brought any more: a handful of real IPOs, the heaviest was that of the armaments manufacturer Hensoldt with 460 million euros. In addition, as a special case, there was the spin-off of the Siemens energy business, in which existing shareholders were allocated the new papers. Other projects were specifically planned, but were postponed due to the corona pandemic.

For the coming year, Vodafone is holding out the prospect of going public with the radio mast division. According to reports, the financial investor EQT is preparing its software company Suse for the floor, further projects are pending (see F.A.Z. of September 12).

Again and again, however, IPOs become obsolete because they are only an option or even emergency solution while a sale is being negotiated at the same time. EQT is now handing over the service provider Apleona directly, as is Siemens the Flender drive division. “A sale is typically safer than an IPO,” says Holger Knittel, head of merger advice at Citi in German-speaking countries. Selling is less dependent on daily market fluctuations and is possible in one fell swoop – in contrast to the gradual, month-long exit via the stock exchange. “The time to exit takes much longer with an IPO,” says Knittel. According to him, IPOs have become more attractive because of the high valuations. “There will be more IPOs, at least they will be increasingly perceived as an option.”

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