New York, NY— Ninety venture-backed M&A deals were reported in the third quarter, 20 of which had an aggregate deal value of $5.1 billion, increasing 39 percent compared to the second quarter and marking the strongest quarter for M&A exits with disclosed value this year, according to the Exit Poll Report by Thomson Reuters and the National Venture Capital Association (NVCA).
Only 13 venture-backed initial public offerings (IPOs) launched, raising $1.7 billion in the third quarter – a 55-percent decrease in total dollars raised in the previous three months. Biotechnology companies accounted for 10 of the IPOs. All but one were U.S.-based companies.
Another important trend
Bobby Franklin, President and CEO of NVCA said in a statement, “While the number of companies making a public offering during the third quarter was down as a result of market volatility, M&A activity was robust, marking the strongest quarter by disclosed deal value this year.
“Of the thirteen companies that did make an IPO, more than two-thirds are currently trading above their offering price in the middle of a choppy market, a strong indicator of the quality of venture-backed IPOs,” he continued.
“In addition to market volatility weighing down IPOs, another recent and important trend that has impacted the venture-backed IPO market is the increased activity of both VCs and non-traditional investors making late-stage investments into private companies that might otherwise file for an IPO. While these so-called ‘private IPOs’ are weighing down the current IPO market, it also means the venture-backed IPO pipeline is deep and we are hopeful exit activity picks up steam in future quarters.”
IPO Activity Overview
Led by the biotechnology sectors, ten of the 12 offerings during the quarter were life sciences IPOs, representing more than three-quarters of the total listings in the third quarter.
By location, 11 of the quarter’s 12 IPOs were from U.S.-based companies. In the only non-U.S. offering of the quarter, Austria-based Nabriva Therapeutics AG (NBRV) raised $92.3 million on the NASDAQ stock exchange on September 17th.
In the largest IPO of the quarter, Sunrun Inc (RUN), a San Francisco, California-based provider of solar energy, raised $250.6 million and began trading on the NASDAQ stock exchange on August 4th. The company is currently trading 26 percent below its $14 offering price.
