Recently there has been much comment about the declining numbers of initial public offerings in the United Kingdom and the United States. That concern is exemplified by this article in the Financial Times of 13 November 2011 (“A market less efficient: Drop in listings fuels concerns that exchanges ceasing to channel capital”) and is also seen in a recent report for the City of London Corporation which we discussed in this post.
Responding to this concern, in March 2011 the US Treasury Department convened the “Access to Capital Conference” on how to promote access to public capital though the IPO market. Out of that conference a group of professionals describing itself as “representing the entire ecosystem of emerging growth companies – venture capitalists, experienced CEOs, public investors, securities lawyers, academicians and investment bankers” formed an “IPO Taskforce” to:
“examine the conditions leading to the IPO crisis and to provide recommendations for restoring effective access to the public markets for emerging, high-growth companies”.
The Taskforce presented its report to the US Treasury on 20 October 2011. The report can be read here.
Causes of the decline of the IPO market
In analysing the reasons for the drop in the numbers of IPOs in the US, the Taskforce: