Investment banks downbeat on European IPOs

A record amount was raised from IPOs and secondary offerings in Europe in the first quarter, but the Wall Street Journal reports that investment bankers are increasingly downbeat about prospects in the months to come.

Figures released by Capital DATA show E48.56 billion ($46.46) was raised between January and March in primary and secondary issues in Europe, an 86% increase from the year-earlier quarter’s total.

But the Wall Street Journal reports that the good news may be about to end. There is concern amongst leading investment bankers that investors are becoming more selective and more price sensitive in committing their money to new issues. The large supply of IPOs scheduled for the second and third quarters may have to be scaled back in the face of changing investor sentiment and the downturn in hi-tech stocks on US and European exchanges.

In the first quarter of 2000, Capital DATA said the number of firms coming to the market rose to 127 from 83, while secondary issues rose to 143 from 68.

Goldman Sachs raised $4.95 billion between January and March, putting it in first place in the league table for the quarter. Second place went to Deutsche Bank, which attracted a total of $3.52 billion from institutions.