Energy, Mining Sectors Fuel IPO Take-off for 2011

Lucas Gilmore, “Big 4″ observer
January 04, 2011 /

Energy and mining sectors have helped boost the initial public offering (IPO) activity in 2010 which recorded a major increase for the first time since 2006, from less than $2 billion in 2009 to $5.5 billion in 2010, according to PwC’s survey on IPO activity in Canada.

The survey showed that in the last quarter of 2010, IPO has reached its total through the 31 new issues worth $1.2 billion on all exchanges. The Toronto Stock Exchange (TSX) gathered a total of $1.1 billion in new equity from ten new issues during the final quarter in 2010 compared with only one issue it listed on the same period in 2009. Seventeen IPOs were listed in the TSX Venture exchange during the same quarter in 2010 that totaled $139 million.

Overall listed issues in 2010 reached 25 in number with total worth of $5.2 billion compared with only $1.7 billion in 2009 for four IPOs. The TSX Venture exchange also listed 42 IPOs with combined value of $347 million in new equity.

The IPO of Athabasca Oil Sands Corp. accounted for the largest issue in 2010 with a total value of $1.3 billion.

According to Neil Manji, PwC national IPO services leader, energy and mining sectors have boosted the IPO activity in 2010, which he said would continue this year.

In fact, the oil and gas industry turned in the biggest value of new equity in 2010, $2.7 billion, while the mining sector represented nearly $1 billion.

These signs of improvement in Canadian IPO activity promise for a momentum that will go on in 2011, Manji said. Manji added that PwC initially expected the IPO activity to rise to only $4 billion, but the result exceeded their expectation.


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