US investors lead the way as ISEQ enjoys flotations boost
After six years in the doldrums, the Irish Stock Exchange (ISE) is seeing the highest number of new flotations since the economic crisis struck, fuelled by US investment in particular.
The significant majority of investors in Irish stocks are North American, making up 40pc of holders, while Irish institutional investors hold just 3pc of Irish equities, according to data from Davy Corporate Finance.
Major international buyers of Irish shares in 2013 included Blackrock, Fidelity, Franklin Templeton, Investec and Paulson, the Davy research shows. There has been strong foreign buying in in several Irish companies, including CRH, Grafton, Kingspan, Ryanair and Paddy Power.
European stock markets as a whole rose by 20pc over the last 12 months. The ISEQ rose by 31pc over the same period, making it the fourth best-performing market in the world this year.
The Irish stock market is now running at its highest level since September 2008, when Lehman Brothers collapsed.
In Europe, almost €15bn worth of deals have been priced this year so far, driven mainly by demand from US investors. In the US, there were €40bn worth of new issues, mainly led by tech companies, including Twitter's whopper float.
In 2007, there were nine ISEQ listings, the data from Davy shows. By 2012 just one company had floated here.
Now Mincon has joined the Stephen Vernon-led Green REIT, explorer Falcon Oil & Gas and Dermot Smurfit Jr's GameAccount Network in 2013's ISEQ IPO revival.
Due to follow suit very shortly is Hibernia REIT, the fifth ISEQ float this year. Floats next year are likely to include more additions to the property fund stable.
"We've always felt there would be a min-REIT sector here," said Davy's corporate broking MD Paul Burke.
These are unlikely to be Green REIT and Hibernia-style 'cash box' fund floats, where money is raised in advance, but rather IPOs driven by funds that are already asset-rich.
Kennedy Wilson and possibly Nama are mooted to be considering REIT IPOs.