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. Last Updated: 07/27/2016

Foreign IPOs Take 30% Of Issues in U.S. Market




NEW YORK -- Foreign initial public offerings in the United States are grabbing a greater share of the market than everbefore, accounting for about 30 percent of all issues in the first half of this year.


Last week alone, Russian telecom heavyweight Mobile Telesystems, Chinese Internet portal Netease.com Inc. and Israeli software maker ClickSoftware Technologies Ltd. raised about $402.8 million between them in their U.S. debuts.


Non-U.S. initial public offerings accounted for almost $13 billion, up from 22 percent last year, and a mere 6 percent in the mid-1990s, said Richard Peterson, chief market strategist at Thomson Financial Securities Data.


During the first six months of 2000, European companies issuing in the United States made up about 40 percent of the total foreign IPOs. German computer chip maker Infineon Technologies AG, helped prop Europe's share of the total when it generated about $5 billion in its U.S. debut March 13.


Asian companies raised about 30 percent of the total foreign issues in the period. A standout among these is China's No. 2 telecommunications provider, ChinaUnicom, which raised $4.2 billion in mid June.


Latin American issues took 2.2 percent of the total IPO issues during the first half of the year.


The allure of the United States' markets lies mainly in the amount of money circulating in it, said Fitzgibbon. The United States holds about 45 percent of the world's capitalization, he said, followed by Japan and the United Kingdom, which together account for about 25 percent to 30 percent.


Aggarwal said that European IPOs should be seen more like U.S. IPOs, since emerging markets tend to be quite volatile.


Among this year's winners in the foreign IPO market was Germany's Infineon, which doubled in value during its first day, hitting $68 per American Depositary Receipt, up from an initial asking price of $33.93. Prices continued to rise, and were at more than $79 on June 30. ChinaUnicom rose 23 percent on its first day to hit $24.50, up from the initial price of $19.99.


In contrast, Chinese Internet portal Netease.com fell to $12.13 after debuting at $15.50, and ClickSoftware, which priced at $7, below the expected range of $9 and $11, closed at $7 June 30.