Thursday 1st Jul 2010
Press Release
The IPO Market Shows Momentum
Venture-backed company exit activity showed continued momentum during the second quarter of 2010, with the best quarterly total for venture-backed Initial Public Offerings.
According to the Exit Poll report by Thomson Reuters and the National Venture Capital Association (NVCA). The quarter ended with 17 venture-backed IPOs, marking the third consecutive quarter for increased offerings, by number and by dollar amount. There were also 92 M&A transactions completed in the quarter, demonstrating continued strength of venture-backed acquisitions as an exit alternative.
"From a pure volume perspective, the venture-backed exit market is on the right trajectory with an increased number of IPO's and a stable and strong number of acquisitions. The second quarter activity supports the notion that an initial public offering is a viable exit alternative once again," said Mark Heesen, president of the NVCA. "However, volumes paint only half the picture. While the quality of acquisitions has held up, post-IPO performance must improve overall if we want to move towards a sustainable
recovery."
There were 17 venture-backed IPOs valued at $1.3 billion in the second quarter of 2010, the strongest quarter, by number of deals and dollar volume, since the fourth quarter of 2007. The offerings spanned a diverse set of industries.
In the biggest venture-backed deal of the quarter, Google Inc acquired AdMob, Inc, a San Jose, California-based operator of a mobile advertising marketplace for $750 million. In the next largest transactions of the quarter, Symantec acquired PGP Corporation and Jack Henry & Associates acquired iPay Technologies LLC, each for $300 million.
Deals bringing in the top returns, those with disclosed values greater than four times the venture investment, accounted for 65 percent of the total in the second quarter of 2010, Venture-backed M&A deals returning less than the amount invested accounted for 15 percent of the quarter's total, compared to 31 percent last quarter.
