US new issues market booming

THE US Initial Public Offerings market exploded in the third quarter, as 14 venture-backed companies completed new issues, raising $1.72bn (£930m).

That means the number of IPOs in the first three quarters of 2004 has already surpassed the totals in each of the past two years. There were just eight IPOs in 2003 and 13 in 2002.

Google was the largest venture-backed IPO of the quarter, raising $1.2bn for the search engine company, while the next largest was Idenix Pharmaceuticals, a developer of drugs to treat infectious diseases, which raised $64.4m.

Additionally, the number of mergers and acquisitions of US venture-backed companies kept pace with the level of activity reported in the first two quarters of the year.

In the third quarter, 90 venture-backed US companies were merged or acquired for a total of $5.89bn.

VentureOne analyst Matthew Garlick said the merger and acquisition deal flow indicated that M&As continue to provide the most realistic, viable exit opportunity for venture investors and their entrepreneurial companies in the current environment.