TORONTO – A report by PwC suggests a collapse of the market for new mining issues in the first quarter of 2014 led to the worst three-month period for Canadian initial public offerings in five years.
The firm said there were just two new issues worth $3.8 million on the TSX Venture Exchange in the first quarter and no new offerings on the Toronto Stock Exchange, Canada’s largest equity market.
That compared with four new issues with a value of $422 million on all Canadian exchanges during the first quarter of 2013.
PwC said it was the lowest quarterly tally for new issues since the first quarter of 2009, when there were $2.5 million in new issues.
The firm also noted it was the fourth time since 2008 that its quarterly survey reported no new issues on the TSX — the most recent in the first quarter of 2012.
Dean Braunsteiner, national IPO services leader at PwC, said the prospects for a quick turn-around did not look encouraging with the pipeline of new issues virtually empty
“This time last year, REITs were driving the market,” Braunsteiner says.
“But concerns over interest rates have sidelined that market for now. With a damper on commodity prices and a big question mark over China, the extractive industries aren’t in a position to pick up the slack.”