Wherever they go, Asian letterhead sponsors face a difficult IPO market, as a combination of increased regulatory scrutiny and decreasing investor interest closes the window for new listings from the US to Asia.
SPAC IPOs in Asia have also subsided after initial hype
According to data provider SPAC Research, at least six Asia-linked special-purpose acquisition companies seeking a total of $1.3 billion in US IPOs have been dissolved in the last three months.
Only one of the 12 blank companies that applied for a public offering in Hong Kong ever began trading. In Singapore, the SPAC was halted after the first three initial public offerings in January.
“We need to see lower volatility and investors with a more risk-averse mentality to transform the global IPO market this year,” said Paul Uhren, head of investment banking at JPMorgan Chase & Co.
However, some mergers are still in the works, with the Middle East alternative asset manager Investcorp raising about $260 million last week in a SPAC aimed at merging with the India-based firm.
According to Uren, when market circumstances improve, there will be more activity in the IPO markets and fewer SPACs in Asia.