Australia Joins Global IPO Mania As Companies Raise $712m In October

Australia’s biggest IPO of the year may be yet to come. Brookfield Asset Management Inc. last week started gauging investor demand for an IPO of its coal terminal operator, which could achieve an equity value of as much as A$1.5 billion through the listing, Bloomberg News has reported.

Other offerings in the works include one by Home Consortium Ltd., a real estate company, which said this month it was planning an IPO of its supermarket-focused HomeCo Daily Needs REIT. The listing could raise A$300 million and could begin trading Nov. 23.

Despite the increase, the total raised through IPOs in Australia this year is historically low. Only $1.2 billion of first-time share sales have priced so far in 2020, compared to $4.7 billion in 2019 and $6.3 billion in 2018. Investors remain cautious about the U.S. presidential election and the months-long coronavirus lockdown in Victoria, Australia’s second-most populous state, Whitehead said.

The outlook for the Australian IPO market depends on the prospects for economic recovery, which could drive interest at home as well as from overseas. “We are seeing good support from international investors,” Whitehead said.

Investors have been looking for stocks in sectors that promise growth or steady dividends, Whitehead said. There may be room for offerings from other areas of the economy once a reopening takes root, he added.

Bloomberg