Zee Beam News

MOSCOW, December 14 (RIA Novosti) - Russia's position on the IPO market gained strength as overall global IPO activity saw a considerable growth in 2005 according to figures released Wednesday by Ernst & Young and Thomson Financial. The audit and consulting companies found in their survey that $138.5 billion was raised on the IPO market in the January - November period, exceeding the $124 billion raised in the whole of 2004. The survey showed that a sustained IPO growth was registered in Europe with a 68% increase in capital raised in 2005 to $51.2 billion year-on-year. Russia, among the emerging European markets, increased the number of closed deals by 33% against last year and capital increased by 386%. The increase in global IPO activity was led by larger deals in 2005, the survey said. There were 59 deals, raising more than $500 million in January - November 2005, compared to 44 of similar size in the same period in 2004. The three largest deals in 2005 included China Construction Bank, which raised $9.2 billion, making it the largest IPO in five years. China's capital increased 43% in 2005 against last year and the country continues to retain the leading position in Asia. The two other largest deals in 2005 were for state-owned French enterprises: Electricite de France ($7.3 billion raised) and Gaz de France ($4.8 billion). While none of the three top IPOs were in the United States, the country managed to preserve its leading position in terms of both the total capital raised and the number of deals. The U.S. closed 175 deals with $27.9 billion raised in capital. Ernst & Young partner for the CIS Doug Gardner said the strong position of Russia in the survey is evidence of Russia's economic growth and its integration into the world economy. He said Russia's combined economic growth in the past six years was approximately 45%. He said this economic success was the result of a consistent economic strategy aimed primarily at the restoration of the financial system in the country, the improvement of the investment climate and the development of the market infrastructure.