The coronavirus, or COVID-19, has reshaped the IPO market that was expected to be very active during the first half of 2020. Many prominent companies that have shown interest in entering the public market have pushed to delay during this time of investment uncertainty. A few factors that have affected the IPO market so far include the unprecedented market volatility, the stock market's 'fear index' reaching record high levels, the failure of "unicorn" companies in 2019, and the upcoming presidential election in November. On top of those factors, the coronavirus outbreak has been the market's 'black swan', or unforeseen event, that has made investors and companies nervous about the future of the global economy. It's pretty fair to assume the IPO market will be relatively small moving forward in 2020.
For the first week of march, only one IPO, albeit March's first billion-dollar offering, and two Special Purpose Acquisition Companies (SPACs) entered the market. International waste giant GFL Environmental (NYSE: GFL) listed on both the New York Stock Exchange and Toronto Stock Exchange. The company had raised an offering of $1.425 billion from 75 million shares offered at $19 each, which was the lower end of the stock's expected range. GFL had a shaky start entering public trading and ultimately finished its first week down 10% from its IPO.
The two SPACs that debuted last week were Flying Eagle Acquisition Corp. (NYSE: FEACU) and LifeSci Acquisition Corp. (NYSE: LSDACU). Flying Eagle was 2020's second largest black check company to date, raising $600 million from 60 million shares priced at $10 each. LifeSci was formed by the health care focused investment bank LifeSci Capital for the purpose of acquiring an entity in the health care business. The SPAC raised an offering of $60 million from 6 million shares prices at the standard $10 each.
The Week Ahead:
The genetic disorder biotech Imara plans to price on the global Nasdaq on March 12. The Boston-based company plans to offer over $92 million for about 4.5 million shares priced between $16-$18. Recently, biotech companies have been really the IPOs that have been able to be successful in the current market, though Imara is a smaller company than other 2020 biotech IPOs.
DFP Healthcare Acquisitions Corp. also threw its hat into the ring this week, with the SPAC aiming to raise $230 million for 20 million offered shares priced at $10 each.