Blackstone IPO sets stage for robust 2007

The past week's US market for initial public offerings lacked quantity, but Thursday's $4.13 billion offering by Blackstone Group more than made up for it, and put the US IPO market on a high note for the first half of 2007, and likely the rest of the year.
Blackstone, the week's only major IPO, raised $1.6 billion more than the total $2.5 billion generated by initial public offerings during the month of June 2006, according to Dealogic. Excluding REITs and special purpose vehicles, or blank check company IPOs, about $25 billion has been raised by new company flotations year to date.
Another 9 companies are scheduled to have public offerings next week, filing with the US Securities and Exchange Commission to together raise as much as $1 billion.
At that rate, US IPOs in the first half of 2007 will have eclipsed by more than 25 percent the $20.6 billion generated by offerings, including Mastercard Inc's $2.57 billion flotation, for the same period in 2006. Ernst & Young this week said 2007 IPO outlook for the rest of the year continued to be bright.
"As of May 30, the pipeline of US IPO candidates was extremely strong - 131 companies filed to raise $24.8 billion," said Maria Pinelli, strategic growth markets leader for the accounting giant's Americas division. That puts first-time offerings in the US on track to exceed the $50 billion raised in 2006 and to do far better than the $40 billion generated in 2004.
The picture is still developing, said Scott Sweet, managing director for research firm IPOboutique.com. Since the May 30 data more companies have filed with the US Securities and Exchange Commission to tap the public, some to the tune of billions of dollars, he added.
"There's MF Global, that is a very big deal, and they have a very good reputation world-wide," meaning the IPO, which could raise up to $3.7 billion, is likely to be well-received by investors, said Sweet. The IPO will spin off the US brokerage arm of Man Group Plc, the world's biggest hedge fund firm.
And another big deal is also on the horizon - Visa, the world's largest credit card payment system, could go public later this year or early next year. "We've been hearing about Visa for a long time," said Francis Gaskins, president of IPO research firm IPOdesktop.com, forecast the offering, could come towards the end of the year.
Visa on Friday said it was restructuring its business to facilitate an initial public offering. Apart from the mega-billion dollar deals, there are plenty of smaller deals to whet investor appetite.
"There are at least three very high quality tech IPOs next week - AuthenTec, comScore and Data Domain. I expect these to do very well," Sweet said, who is also excited about Mercado Libre, "the eBay of Latin America," which does not yet have a date to list on Nasdaq. The latter will be the first Argentinian dot.com to list on a US exchange since the Internet bubble burst in 2000.