Warner Music Group Corp. and retailer Cole Haan LLC have both pushed back the launch of their listings, people with knowledge of their plans said. While some advisers are telling companies with an IPO on file to wait out the turmoil, that could come with its own risks as reduced retail footfall hits earnings and share sales risk slipping closer to the U.S. election in November.
“There’s a tremendous backlog of really strong businesses, but the volatility in the market makes it very difficult for investors to price it,” Kristin Declark, co-head of equity capital markets at Barclays Plc, said in a Bloomberg TV interview.
“I don’t think we’ll see a return of IPOs until we start to see the VIX stabilize,” she said, referring to the Chicago Board of Options Exchange Volatility Index.
One company that bucked that trend is Canadian waste management company GFL Environmental Inc., which took advantage of Monday’s temporary respite from the rout to price shares in its IPO a day early. The stock slid in its trading debut in New York Tuesday, closing at $16.80 -- 12% below its $19 IPO price.
“Today was a good day in the market,” Raymond Svider, the chairman of GFL-backer BC Partners, said Monday after the stock priced. “It would make absolutely no sense to take another day of volatility. It’s better to price, get it done tonight and move on.”
Despite the uncertainty and travel limitations, one big event on the M&A calendar is still going ahead -- at least at the moment.
The Annual Tulane Corporate Law Institute, a get-together of lawyers, bankers and proxy solicitors in New Orleans, kicks off Thursday, just a week after the city’s Mardi Gras celebrations. In an official communication confirming that the conference was on, the organizers had some advice for old friends and contacts greeting each other at Wednesday night’s welcome parties.
“We would not be surprised if many attendees choose not to shake hands (apparently elbow-bumps are in fashion),” they wrote.
--With assistance from Aaron Kirchfeld, Ed Hammond, Kiel Porter, Kristen V. Brown and Dinesh Nair.
This article was provided by Bloomberg News.