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  • Capital Markets 2018 Deep Dive – Mid-Year Update June 12, 2018

    REUTERS / Firstname Lastname

    REUTERS / David Mdzinarishvili

  • Capital Markets 2018 Deep Dive

    Capital Markets 2018 Deep Dive

    Matthew Toole is the Director of Deals Intelligence within Thomson Reuters Investing and Advisory Division and is

    responsible for communicating broad M&A, capital markets, private equity and venture capital industry trends through

    quarterly research reports and the financial media. Matthew’s research has been featured in various global financial

    publications including The New York Times and the Financial Times and he has appeared on CNBC’s Worldwide

    Exchange and Squawk Box and The Nightly Business Report.

    Stephen Lacey is US Editor for International Financing Review, responsible for coordinating coverage of Americas

    capital markets teams (fixed income, securitization, derivatives, equities) across real-time and print publications. Since

    joining IFR in 2001, Mr. Lacey has specialized in coverage across the life-cycle of equity capital markets, from venture

    capital/private equity to IPO, and onto public equity (primary/secondary stock sales, convertible bonds and M&A). He

    previously headed up IPO coverage at Red Herring, a bi-weekly publication focused on the venture capital industry.

    Anthony Hughes is Assistant Editor for International Financing Review with primary responsibility for overseeing

    equity capital markets coverage, including publication of the IFR US ECM Briefing. In this capacity, Mr. Hughes

    specializes in coverage of TMT, Industrials and Financials. He has had a long career in business journalism, starting in

    Australia as Investment Editor of the Sydney Morning Herald as well author of a daily stock market column for the

    Australian Financial Review. Prior to joining IFR in 2011, Mr. Hughes worked as AFR’s New York correspondent. He

    has also co-authored two books on stock market investing in Australia. Anthony is a CFA charterholder.

  • Capital Markets 2018 Deep Dive

    Capital Markets Deep Dive

    28%

    30%

    21%

    21%

    Investment Banking Revenue by Product 2018

    Mergers & Acquisitions Debt Capital Markets

    Equity Capital Markets Syndicated Loans

    $0

    $5

    $10

    $15

    $20

    $25

    $30

    2013 2014 2015 2016 2017 2018

    Regional IB Revenues

    Americas Europe Asia Pacific

    $0

    $5

    $10

    $15

    $20

    $25

    $30

    2013 2014 2015 2016 2017 2018

    BONDS EQUITY LOANS MA

  • Capital Markets 2018 Deep Dive

    Global Equity Capital Markets activity falls 4% compared to 2017 levels

    $0

    $50

    $100

    $150

    $200

    $250

    $300

    $350

    $400

    $450

    $500

    1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

    Global IPO ($bil) Global Follow-Ons ($bil) Global Convertibles ($bil)

    *year-to-date for all time periods

  • US Listed Initial Public Offerings hits four-year high, raising $25.8 billion, up

    37% from a year ago; Number of offerings up 30%

    0

    50

    100

    150

    200

    250

    $0

    $10

    $20

    $30

    $40

    $50

    $60

    1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

    US Listed IPO Proceeds ($bil) Number of Offerings

    Capital Markets 2018 Deep Dive

  • Top US Listed Initial Public Offerings: First Half 2018

    Capital Markets 2018 Deep Dive

    $3

    $3

    $3

    $3

    $3

    $5

    $8

    $8

    $9

    $17

    $0 $5 $10 $15 $20

    Bolsa Mexicana de Valores

    Ho Chi Minh City STC

    London

    Mumbai

    National Stock Exchange

    Hong Kong

    Shanghai

    Frankfurt

    Nasdaq

    New York

    2018YTD IPO Proceeds ($bil)

  • Capital Markets 2018 Deep Dive

    Could Spotify’s direct listing on the NYSE disrupt the traditional IPO process?

  • Capital Markets 2018 Deep Dive

    Spotify’s performance since listing on the NYSE

  • Capital Markets 2018 Deep Dive

    Tech listings lead 2018 offerings with 24% of total proceeds; Industrials lead by

    number of offerings so far this year

    10

    20

    30

    40

    50

    60

    70

    80

    90

    $0

    $2

    $4

    $6

    $8

    $10

    $12

    $14

    $16

    $18

    $20

    High Technology

    Financials Healthcare Industrials Real Estate Consumer Products

    Energy and Power

    Retail Materials Consumer Staples

    Media and Entertainment

    Telecom

    IPO Proceeds ($bil) Number of Offerings

  • Global Block Trades account for 30% of follow-on activity so far this year, on par

    with year-ago levels; Overall follow-ons down from 14% during year-to-date 2018

    0%

    5%

    10%

    15%

    20%

    25%

    30%

    35%

    40%

    45%

    $0

    $50

    $100

    $150

    $200

    $250

    $300

    $350

    $400

    $450

    1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

    Global Block Trades ($bil) Non-Block Trade Follow Ons ($bil) Block Trades a % of Total

    Capital Markets 2018 Deep Dive

    *year-to-date for all time periods

  • Capital Markets 2018 Deep Dive

    Top Global Follow-On Offerings: First Half 2018

  • Capital Markets 2018 Deep Dive

    Special Purpose Acquisition Company (SPAC) offerings on pace for record year

    5

    10

    15

    20

    25

    30

    35

    40

    45

    $0

    $1

    $2

    $3

    $4

    $5

    2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

    SPAC IPO Proceeds ($bil) Number of Offerings *year-to-date for all time periods

  • Technology convertible bond offerings account for 21% of total issuance this year

    as Twitter, Western Digital, Square tap the markets

    0%

    10%

    20%

    30%

    40%

    50%

    60%

    70%

    80%

    90%

    100%

    $0

    $10

    $20

    $30

    $40

    $50

    $60

    $70

    $80

    $90

    $100

    1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

    Technology Convertibles ($bil) Non-Technology Convertibles ($bil) Technology as % of Total

    Capital Markets 2018 Deep Dive

    *year-to-date for all time periods

  • Global High Yield offerings decline 21% by proceeds and 18% by number of

    new offerings

    0

    50

    100

    150

    200

    250

    300

    350

    400

    450

    500

    $0

    $50

    $100

    $150

    $200

    $250

    1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

    Global High Yield Corporate Debt ($bil) Number of Offerings

    Capital Markets 2018 Deep Dive

    *year-to-date for all time periods

  • Top Global High Yield Bonds: First Half 2018

    Capital Markets 2018 Deep Dive

    $1

    $3

    $8

    $9

    $9

    $11

    $13

    $14

    $0 $5 $10 $15

    CCC

    CCC+

    B-

    BB+

    BB

    BB-

    B

    B+

    S&P Ratings ($bil)

  • Global Investment Grade bond offerings fall 8% compared to year-to-date

    2017; US marketplace offerings decline 15% compared to a year ago

    0

    1,000

    2,000

    3,000

    4,000

    5,000

    6,000

    7,000

    $0

    $200

    $400

    $600

    $800

    $1,000

    $1,200

    $1,400

    $1,600

    $1,800

    $2,000

    1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

    Global Investment Grade Corporate Debt ($bil) Number of Offerings

    Capital Markets 2018 Deep Dive

    *year-to-date for all time periods

  • Top Global Investment Grade Bonds: First Half 2018

    Capital Markets 2018 Deep Dive

    121

    128129

    136

    147

    126

    106

    117

    109 106104

    89

    96 91

    0

    20

    40

    60

    80

    100

    120

    140

    160

    2015 2016 2017 2018

    Avg. US Investment Grade Spreads (BPS)

  • Questions and Second Half 2018 Outlook

    REUTERS / Firstname Lastname

    REUTERS / David Mdzinarishvili

  • IFR Daily Briefings: Essential Reading

    for US ECM Professionals

    Capital Markets 2018 Deep Dive

    World class content and analytical tools

    for the deal making community