An analysis of the new issues 2017 including the new trading segment Scale by Dr. Konrad Bösl, Managing Director of Blättchen & Partner GmbH in Munich.
In 2017 there were eleven new issues in Germany (previous year six) with a public offering, four of which were in the new Scale trading segment. Only the five IPOs in the fourth quarter saved the new issue balance sheet for 2017. With AlzChem, only one issuer had to cancel the IPO shortly before the start of listing (previous year two). At a good € 2.64 billion, the issue volume was at its lowest level since 2011 and almost halved compared to the previous year. No IPO in Germany reached the billion euro mark in terms of issue volume (previous year one). Worldwide in 2017 there were as many
many new issues as they have not been in ten years. By comparison, new issuance activity in Germany remained insignificant, as it has been for years.
I. New issuance activity in Germany cannot compete internationally
The general conditions for IPOs in Germany in 2017 were very positive. The historically low interest rate level continued and contributed to strong economic development. For the first time in its history, the DAX passed the 13,000 point mark and rose by around 12.5% in the course of the year. The number of new issues almost doubled in Germany, which corresponds to a worldwide increase in IPOs of around 49%. We should not be deceived by this parallelism, as the starting level was very low in Germany with six IPOs in 2016. While the volume of IPOs increased by 40% worldwide, the volume of IPOs in Germany declined by around 53%. In terms of the number of new issues worldwide, Germany’s share of global new issuance activity was only just under 0.7%, or 1.5% of the issue volume. The weakness of new issuance activity in Germany, which is reflected in this figure, has been evident for years. A European comparison also shows that Germany, Europe’s leading economic nation, has been lagging behind in terms of new issuance activity for years. Compared to the previous year, the number of new issues in Europe rose by approx. 44.8%, the issue volume even by approx. 45.4%.
II. Key features of new issues in 2017
There were a total of eleven new issues in Germany in 2017, in which shares were offered for public subscription. Ten of the eleven issuers have their registered office in Germany. It is noteworthy that five of the issuers still had to report a loss in the year prior to the IPO.
This included three of the seven issuers who had their shares listed in the Prime Standard and, again measured by sales, the two largest new issues HelloFresh (EBIT margin -15.2%) and Delivery Hero (EBIT margin -53.8%), as shown in Fig. 14.