Without a single new issue on the TSX in the third quarter, the Canadian market for initial public offerings (IPOs) fell further behind the pace of last year, according to PwC Canada.
Just nine new issues made it to market on all exchanges in the quarter for a value of $194 million. By comparison, there were 12 IPOs with a value of $792 million in the same period of 2018.
Year-to-date, 31 IPOs with a value of $646 million reached the market in the first three quarters of 2019, compared to the 32 new issues that raised $1.9 billion in the same period of 2018.
There has not been a new issue on the TSX since the first quarter of 2019 when Lightspeed POS Inc. debuted on Canada's senior exchange, the PwC review showed.
The largest issue of the quarter was the $188 million flotation of Sundial Growers Inc. on NASDAQ, a continuation of the trend of Canadian companies listing on U.S. exchanges.
Seven companies went public on the CSE in the third quarter — six from the mining sector — with total proceeds of $4.5 million while a single mining issue on the TSX-Venture raised $1.8 million.
"Headline news items around global trade tensions and market volatility combined with summer doldrums led to a poor third quarter for IPOs," notes Geoff Leverton, national IPO leader, PwC Canada, "but there is also the role of alternative equity finance options for growing companies that can delay accessing public markets."
Looking ahead, Leverton adds, "There are offerings in the pipeline, so we will see what the fourth quarter brings. It's also interesting to watch U.S. IPO activity and the tepid reception some recent offerings are getting. We'll see how that plays out over the coming quarters."