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- Category: IPO
Every company has a chance to go public, which means that they can sell a part of their ownership to the public. Usually, a company will offer stocks to the public in an attempt to raise capital to invest in expansion or growth. The general public is able to buy a small percentage of the company’s ownership. The process is called as Initial Public Offering (IPO). Let’s take a look at the top 10 Global IPOs.
ALIBABA GROUP (2014).
Alibaba Holdings Group (NYSE:BABA), a diversified online ecommerce company based in China is the most popular destination for online shopping, in the world’s fastest growing e-commerce market. It’s three main sites – Taobao, Tmall and Alibaba.com, have hundreds of millions of users, and host millions of merchants and businesses.
The Company provides Internet Infrastructure, Consumer-to-Consumer (C2C), Business-to-Consumer (B2C) and Business-to-Business (B2B) sales services via web portals. It also provides Electronic Payment Services, a shopping search engine and data-centric cloud computing services.
Alibaba became one of the most valuable tech companies in the world after raising $25 billion from its U.S. IPO. It chose to list in the U.S. as the Hong Kong exchange refused to accept the structure. Although technology companies traditionally list on NASDAQ, Alibaba chose the New York Stock Exchange for its debut and used underwriting primarily from Credit Suisse.
On 19th September 2014, Alibaba’s shares (BABA) began trading on the NYSE with shares opening up at more than 35% above the $68 IPO price.
AGRICULTURAL BANK OF CHINA
ABC Bank, otherwise known as the Agricultural Bank of China (listed on the Shanghai Stock Exchange and the Hong Kong Stock Exchange), is one of China’s five largest banks. ABC Bank went public on July 7, 2010 at an initial offering raising $19.228 billion.
The bank’s shares were sold simultaneously in Hong Kong and Shanghai. In Hong Kong, the stock was priced at 3.20 Hong Kong Dollars each, in the middle of the expected range. In Shanghai, the Class A shares – which only Chinese nationals can buy – were priced at 2.68 renminbi, the high end of expectations.
On completion in August 2010 it became the world’s biggest IPO surpassing the one set by Industrial and Commercial Bank of China in 2006 of US$21.9 billion. It raised a total of US$22.1 billion after both Shanghai and Hong Kong’s over-allotments were fully exercised.
CICC, Goldman Sachs and Morgan Stanley led the Hong Kong offering with JP Morgan, Macquarie, Deutsche Bank and ABC’s own securities unit also involved. CICC, Citic Securities, Galaxy and Guotai Junan Securities handled the Shanghai portion.
BELOW CHART SHOWS THE STOCK PERFORMANCE OF ABC BANK:
INDUSTRIAL AND COMMERCIAL BANK OF CHINA :
ICBC Bank, or Industrial and Commercial Bank of China (listed on the Shanghai Stock Exchange and the Hong Kong Stock Exchange), went public on October 20, 2006, fetching a total of US$21.9 billion. At that time, ICBC Bank was the largest mainland Chinese bank and the third large Chinese bank to go public.
The state-owned bank, priced its Hong Kong offering at 3.07 Hong Kong dollars a share, at the top end of the indicative price range of HK$2.56-HK$3.07 ($0.33-$0.39). The Shanghai portion of the offering was priced at 3.11 yuan ($0.39) – near the top of its price range of 2.60 yuan to 3.12 yuan ($0.33-$0.39).
The shares began trading simultaneously in Hong Kong and Shanghai from October 27 2007.
ICBC’s Hong Kong offering had attracted the largest amount of orders ever from retail investors, drawing orders of more than HK$420 billion ($53.9 billion), The Standard newspaper and the Hong Kong Economic Journal said.
Below can be seen the ICBC Shareholding and Group Structure:
The following graph shows the various trends in the share price from Day 1 till 2016.
NTT DoCoMo (NYSE:DCM), a Tokyo-based telecommunications player, went to the public market on October 22, 1998, raising $18.099 billion. Underwritten by Goldman Sachs Asia, this IPO launched NTT to the third largest market cap for a Japanese company.
DoCoMo ended its first day on the First Section of the Tokyo Stock Exchange (TSE) at 4.65 million yen (US$39,754), about 700,000 yen higher than the IPO price of 3.9 million yen (US$33,342). On the first day, trading reached about 360 billion yen (US$3.08 billion), representing 40 percent of all trading on the First Section of the TSE.
NTT DOCOMO, Japan’s largest telecommunications company, provides innovative, convenient and secure mobile services that enable customers to realize smarter lives. The company serves over 71 million customers in Japan via advanced wireless networks, including a nationwide LTE network and one of the world’s most progressive LTE-Advanced networks. DOCOMO is a world-leading developer of 5G networks, which it plans to deploy in the 2020s by leveraging network function virtualization (NFV) and other technologies.
THE BELOW CHART SHOWS THE STOCK PERFORMANCE OF NTT DoCoMo SINCE ITS IPO:
Visa Inc. (NYSE:V) – this debit and credit card processing company entered the public market on March 18, 2008, and raised $17.864 billion—no small feat during a global financial crisis. Visa Inc. ignored the bear market on Wall Street and carried out the biggest-ever U.S. initial public offering in style, with its shares surging 28 percent Wednesday in their first day of trading.
Visa operates the world’s largest retail electronic payments network and manages the world’s most recognized global financial services brand. They have more branded credit and debit cards in circulation, more transactions and greater total volume than any of their competitors. They facilitate global commerce through the transfer of value and information among financial institutions, merchants, consumers, businesses and government entities.
Visa Inc. priced shares for its initial public offering of stock at $44, above the expected price of $37 to $42, according to J.P. Morgan Chase & Co., one of the lead underwriters.
Visa shares closed at $56.50, up $12.50 from the $44 IPO price. They had risen above $60 before settling in the afternoon. The company sold 406 million shares in the offering, raising just under $18 billion.
THE BELOW CHART SHOWS THE STOCK PERFORMANCE OF VISA Inc. SINCE ITS IPO:
AIA GROUP INTERNATIONAL:
AIA (OTC:AAIGF), a Hong Kong-based investment and insurance company, was offered to the public on October 21, 2010. It raised $17.816 billion and become the third Hong Kong-based financial company on this top 10 IPO list.
AIA, the Asian life insurance arm of AIG (AIG.N), raised $17.9 billion by pricing its Hong Kong IPO at the top of its range as investors piled into the most attractive offering in the world’s hottest financial market. It put an end to a long-running saga for American International Group, which tried and failed to sell AIA to Britain’s Prudential (PRU.L) earlier this year. AIA was planned to be listed in Hong Kong Stock Exchange in April 2010. However, in March 2010, Prudential PLC, a UK-based financial services and securities company, announced that it would buy AIA for US$35.5 billion. The purchase later fell through, and AIA held an IPO in October 2010, raising approximately HK$159.08 billion (US$20.51 billion).
AIG planned to use some of the proceeds of the AIA sale to pay back part of the $182.3 billion bailout that it received from the U.S. government during the financial crisis. AIA said that the IPO was priced at HK$19.68 each and that it exercised its upsize option.
THE BELOW CHART SHOWS THE STOCK PERFORMANCE OF AIA GROUP SINCE ITS IPO
(OTC: ENLAY) listed on the New York Stock Exchange on November 1, 1999 after it raised $16.452 billion. This Italian company competes in the gas and electric market in Europe and the Americas. It is the only utility company on the top 10 IPO list.
The initial public offering of Enel SpA, Italy’s state controlled utility, was estimated to be valued at as much as $19 billion (18 billion Euros), making it the biggest IPO ever back then.
Enel’s price range, announced by the Italian treasury, was 3.9 Euros to 4.3 Euros per share. This would value the whole company at between 41 billion Euros and 52 billion Euros. Initially the Italian government had planned to sell between 15 percent and 18 percent of Enel, but due to heavy demand it planned to make at least 23 percent of the company’s share capital available.
Enel is a multinational energy company and one of the world’s leading integrated electricity and gas operators. They work in more than 30 countries across 4 continents, generating energy with a net installed capacity of around 84 GW and distributing electricity and gas across a network spanning about 1.9 million km.
Listed in 1999 on the Milan stock exchange, Enel has the highest number of shareholders of all Italian companies, with 1.1 million retail and institutional investors. Enel’s largest shareholder is the Italian Ministry for the Economy and Finance. In addition to Enel, other group companies are listed on the stock exchanges of Italy, Spain, Russia, Argentina, Brazil, Chile and Peru.
THE BELOW CHART SHOWS THE STOCK PERFORMANCE OF ENEL S.P.A SINCE ITS IPO
Facebook (NASDAQ:FB) was one of the most-hyped IPOs in history. It listed on May 1, 2012 offering 421,233,615 shares at a price of $38 per share and raised $16.007 billion through that offering. This social media technology company’s launch was riddled with trading issues and questionable information-sharing accusations. Nevertheless, it still became the largest technology IPO in U.S. history.
The IPO was the biggest in technology and one of the biggest in Internet history, with a peak market capitalization of over $104 billion. Media pundits called it a “cultural touchstone.”
The IPO had immediate impacts on the stock market. Other technology companies took hits, while the exchanges as a whole saw dampened prices. Investment firms faced considerable losses due to technical glitches. Bloomberg estimated that retail investors may have lost approximately $630 million on Facebook stock since its debut. UBS alone may have lost as much as $350 million.
Today, Facebook is the toast of Wall Street. Worth $226 billion, Facebook’s stock trades at a rich 81x price-to-earnings multiple. Anyone holding shares at the IPO has seen their value more than double.
THE BELOW CHART SHOWS THE STOCK PERFORMANCE OF FACEBOOK SINCE ITS IPO
General Motors (NYSE:GM) debuted on November 17, 2010 after emerging from a bankruptcy filing one year earlier. General Motors Company, commonly known as GM, is an American multinational corporation headquartered in Detroit, Michigan, that designs, manufactures, markets, and distributes vehicles and vehicle parts, and sells financial services.
The current company, General Motors Company LLC (“new GM”), was formed in 2009 following the bankruptcy of General Motors Corporation (“old GM”), which became Motors Liquidation Company. The new company purchased the majority of the assets of the old GM, including the brand “General Motors”.
The General Motors Company IPO launch raised $20.1 billion at $33.00 per share. The next day the U.S. Treasury recovered $13.5 billion reducing the Treasury’s stake in GM from 61 percent to 33 percent. General Motors Company repurchased all preferred stock held by Treasury for $2.1 billion on December 15, 2010.
December 31, 2010, General Motors Company stock closed at $36.86, up 10.5 percent over the IPO. GM sold 478 million common shares raising $15.77 billion, as well as $4.35 billion in preferred shares, more than the initially planned $4 billion.
THE BELOW CHART SHOWS THE STOCK PERFORMANCE OF GENERAL MOTORS SINCE ITS IPO
NIPPON TELEGRAPH AND TELECOMMUNICATIONS CORP:
Nippon Tel (NYSE:NTT) is a Tokyo-based telecommunication provider. This is the oldest IPO on this list. The company raised $15.301 billion on February 9, 1987. Ranked 65th in Fortune Global 500, NTT is the third largest telecommunications company in the world in terms of revenue.
While NTT is listed on Tokyo, Osaka, New York, and London stock exchanges, the Japanese government still owns roughly one-third of NTT’s shares, regulated by the NTT Law.
Established as a monopoly government-owned corporation in 1952, Nippon Telegraph and Telephone Public was privatized in 1985 to encourage competition in the telecom market. In 1987, NTT made the largest stock offering to date, at US$36.8 billion.
THE BELOW CHART SHOWS THE STOCK PERFORMANCE OF NIPPON TEL SINCE ITS IPO