Canadian IPOs at record low

This is the direct consequence of the CON's one-size-fits-all investment dogma, brought to you by Manulife, Power Financial, Gwyn Morgan et al and corporate spokespeople like John Manley who claimed Canada can't have "different business taxed differently", despite the fact that his law firm is one such business that is taxed differently, so too the $480 billion US Master Limited Partnership market in the US. The one that Flaherty falsely claimed had been shut down.

Speaking of Flaherty, Canada's grossly incompetent Minister of Finance...maybe his much ballyhooed single securities regulator would be one too many?


Canadian IPOs at record low

John Morrissy, Canwest News Service Published: Thursday, July 03, 2008

The Bay Street sign is shown in the heart of Toronto's financial district. IPOs in Canada are down significantly.Mark Blinch/ReutersThe Bay Street sign is shown in the heart of Toronto's financial district. IPOs in Canada are down significantly.

OTTAWA -- A "perfect storm" has struck the Canadian market for new stock issues, driving activity in the second quarter to record lows and promising to deliver the worst year of the decade, PricewaterhouseCoopers said Thursday.

During the second quarter, 18 securities were issued on all Canadian exchanges, generating only $466-million in new equity, down from 20 initial public offerings in the same period of 2007 that raised $555-million, the international business consultancy said.

"To put this in context, the 2007 results were already among the lowest on record" said Ross Sinclair, national leader of PwC's IPO and income trust services.

Rattling the market for new issues has been a nasty confluence of extreme market volatility, high oil prices, the U.S. slowdown, concern about the financial services sector and credit markets and the disappearance of income trusts.

"At its current pace, the market will struggle to reach half the value of the slowest period of the decade," Mr. Sinclair said. That nadir was reached in 2001, when just 46 new issues worth $2.07-billion were brought to market.

All of which affects the economy by making it more difficult for companies to raise capital and develop their businesses, Mr. Sinclair said.

"To complete an offering in this market, you need a really compelling story - a quality company, a strong track record, flare and growth," Mr. Sinclair adds. "The only company that brought that combination to the market in the second quarter was Sprott Inc."

The fund manager completed the largest IPO on the Toronto Stock Exchange during the quarter, a $200-million issue, accounting for close to one half of the quarter's $466-million total.

Mr. Sinclair said there is little to brighten the outlook for the remainder of the year

"Even taking into account the TSX Venture exchange, which can sometimes show some interesting trends, has little good news," he said. In the second quarter, only nine IPOs with a value of $30-million made it to the junior exchange, compared with $99-million in the same period of 2007.