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IN TODAY’S EDITION
1️⃣ 3 tales from the 2024 IPO rankings |
2️⃣ The Intrigue jobs board |
3️⃣ Diplomacy of the day |
Hi Intriguer. Sorry to be ✌️that guy✌️ always waiting for a chance to slip my Mexico City stint into conversation, but sheesh, since you mention it, yes Mexico City has an epic food scene. In fact, maybe too good? In a city of 22 million people frequently listed among the world’s great dining destinations, where do you even start? I sometimes had to hit up the nearest Chili’s just for a palate cleanser.
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There are so many ways you could feel your way around: the number of stars awarded by a random French tyre company? Those are rookie metrics. Folks were finding the next hot eatery by counting the bodyguards waiting outside. Three dozen suits out on the curb, eyeing you off warily? The mole poblano inside must truly be life-changing.
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I mention all this because today’s briefing leads with an update on another metric worth your attention: initial public offerings (IPOs).
BUT FIRST, THE HEADLINES
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Nasdaq smashes new record.
The US tech-heavy index has closed above the 20,000 mark for the first time thanks to record runs from Alphabet, Meta, and Tesla. The results might’ve been buoyed by the latest US inflation data indicating prices rose 2.7% from last year, in line with expectations and pointing to a Fed cut next week. Meanwhile across the pond, the European Central Bank is expected to cut rates today (Thursday) as inflation cools towards 2%.
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Hamas yields on key Israeli ceasefire terms.
According to the WSJ, Hamas has now agreed to Israeli forces remaining in Gaza on a temporary basis, and has handed over a list of hostages it would release as part of a deal. In exchange, Israel would release unspecified Palestinian prisoners and allow more aid into Gaza. Israel hasn’t yet commented on the details, which were shared by Arab mediators.
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European NATO members mull 3% commitment.
Several NATO members have apparently entered preliminary talks to discuss increasing their defence spending to 3% of GDP at next year’s summit. That might be a stretch given seven of NATO’s members still haven’t met the decade-old 2% benchmark.
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FBI director to step down early.
Christopher Wray has told staff he’ll step down before Trump takes office, and two years before the end of his own ten-year term. Trump has already named long-time loyalist and former federal prosecutor Kash Patel as his successor — Patel, who’ll need senate confirmation, has been a fierce critic of the FBI.
TOP STORY
Three intriguing tales from the 2024 IPO rankings
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As we approach the end of the year, media outlets everywhere are morally and legally obliged to start writing puff pieces on the year that’s been (fear not, ours is coming). But the fine folks at Bloomberg just dropped one that caught our eye: a global ranking of initial public offerings (IPOs) for 2024.
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Of course, any single data point can tell a million different stories, but IPOs have long been seen as a barometer for local sentiment: whether you’re a 1600s-era Dutch mercantilist financing voyages across the globe, or a 2000s-era US entrepreneur financing voyages across the galaxy, raising or investing is an act of faith in an economy’s future.
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So here are three intriguing tales from the latest global IPO rankings.
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Tough times for the UK
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London’s legendary 300-year-old stock exchange has traditionally been a top-five player, but this year, it barely raised $1B via IPO, down 96% from 2021 and leaving it in 20th place globally behind the likes of Oman, Malaysia, and Poland.
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What happened?
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The recent bout of political and economic turmoil in the UK has left local investors rattled, while various founders have cited familiar reasons to just list elsewhere (particularly the US): deeper capital markets, an easier regulatory burden, and lower taxes.
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Add to that:
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Foreign buy-outs – as the malaise depresses valuations, foreign funds have snapped up local bargains then taken them off the exchange, and
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Foreign competition – governments everywhere are trying to attract listings (including for home-grown champions) to cut their reliance on offshore capital.
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Of course, it’s not all negative: non-IPO trading is strong, and we’ve written previously about how (for instance) China-based firms might prefer a UK listing given US scrutiny.
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But still, despite major reforms to UK listing rules, the big picture seems gloomy.
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India crushes it while China slows
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Given all the uncertainty around China’s trajectory, it’s no surprise its IPOs have plunged: party bosses have tightened the listing rules, so founders are now slow-walking listings while regulators slow-walk approvals, both for fear of getting in trouble. Some of the activity seems to have shifted to Hong Kong instead.
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But a rising star in the region has been India, more than doubling last year’s haul with a cool $17B including its biggest-ever IPO (Hyundai’s local unit floated for $3.3B). And you can see that exuberance in projections for next year, too, with electronics giant LG one of several big names hinting at a listing in the world’s fastest-growing major economy.
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But don’t get too pumped — investors have been pulling cash out of India-linked funds the last few months, spooked by hints of a slow-down and possible over-valuations.
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The European standout: Spain
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The dark-horse winner for Europe this year has been Spain, which raised a total of $3.17B via IPO, climbing 33 places from last year. That’s mostly thanks to a single listing: Puig, the Spanish beauty and fashion giant (think Carolina Herrera and Charlotte Tilbury) debuted with a $2.8B valuation on the Madrid exchange, making it Spain’s biggest IPO in a decade.
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But it’s more than just satin scarves and fresh new fragrances: Spain’s broader economy has chugged, growing 3% this year and forecasting another 2.3% the next, well above the Euro area’s 0.3% and 1.3% respectively. That’s partly a base effect (Covid hit Spain hard), but also reflects increased immigration and government spending. Either way, you can see it all reflected in Spanish stocks, which are outperforming their regional peers.
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And Spanish bankers are hoping the good times will roll into 2025, too, though there’ve been warning lights: Spain’s biggest frozen pastry firm just delayed its IPO for the second time, citing “profound instability” from geopolitics.
INTRIGUE’S TAKE
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We noted above that each data point could tell a million stories, and we really just shared three. So to help zoom out a little, here are four more:
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First, wholesale diamond prices are down 40% over the past two years
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Second, Rolex secondary prices are down 33% over the same period
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Third, Warren Buffett’s firm is now sitting on a record $325B in cash, and
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Fourth, US stocks are now up accounting for a near-record ~62% of the world’s entire market cap. Ranked second? Japan, way back on 6%.
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Diplomats (the good ones at least) try to piece multiple data points together to tell our political leaders a single story about where things might be headed. And when we look at the data points above, we see — much like the frozen pastry firm in Spain — a world holding its breath.
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Also worth noting:
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Asia raised $58.5B in IPOs this year, followed by Europe ($18.6B), and the Middle East and Africa ($12.6B). The US alone raised $40.9B.
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Overall global IPO activity has fallen in 2024 due to high interest rates, lower risk appetite, and a come-down from two years of hot IPO activity in 2020-21.
MEANWHILE, ELSEWHERE…
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🇦🇫 Afghanistan: An ISIS attack killed the Taliban’s acting minister for refugees and six others in Kabul yesterday (Wednesday). Several senior Taliban leaders have been killed since the group’s return to power, mostly in attacks claimed by ISIS, which follows a more extreme ideology and theology.
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🇵🇱 Poland: Warsaw is adding the country’s two largest TV stations to its list of strategic companies, giving it the ability to block their sale if a buyer is determined to be from a “hostile state”. The move comes amid rumours that one network’s parent company (Warner Bros.) is looking to sell, with a possible buyer enjoying close ties to both Poland’s opposition and Hungary’s populist PM.
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🇳🇿 New Zealand: Authorities have cancelled holiday leave for some military personnel in New Zealand to cover civilian strikes by base security guards. As union negotiations continue, New Zealand’s defence minister invoked a rarely used provision that allows uniformed personnel to fill civilian gaps.
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🇨🇱 Chile: Chile’s two state copper mining companies, Codelco and Enami, are reportedly in talks to merge their efforts to expand smelting capacity. Chile is the world’s largest copper-mining nation but it wants to avoid relying on China’s smelting overcapacity, and boost its presence along the broader supply chain.
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🇳🇬 Nigeria: A new refinery in Lagos built by a local billionaire has announced its first petrol export to neighbouring Cameroon. Nigeria has vast oil reserves but has become a net importer of refined oil, in part due to its long-running lack of refining capacity.
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EXTRA INTRIGUE
If you’re looking to switch gears, the Intrigue jobs board is back…
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Supply Chain Analyst @ Koch Industries in Green Bay, Wisconsin
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Political Specialist @ the US Embassy in Vienna
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Equity Analyst @ JP Morgan in Taipei
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Senior Director, People and Culture @ International Rescue Committee in London
DIPLOMACY OF THE DAY
An Australia vs PNG rugby league match in 2022. Credits: Getty.
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While you might’ve seen the news that Riyadh is now set to host the 2034 FIFA World Cup, there are other, quieter ways to approach sports diplomacy: eg, Australia just announced a deal with its very rugby league-mad neighbour (Papua New Guinea, or PNG), that’ll see the Pacific Island nation get its own team in Australia’s league by 2028.
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It’s part of a 10-year, US$385M investment known as the Pacific Rugby League Partnership, helping bankroll the sport’s development in PNG, Tonga, Samoa, and Fiji.
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The catch? Apart from the benefits for a neighbour, Australia has added an intriguing clause, meaning the deal could all be yoinked if PNG signs any security pact with China that undermines Australia’s “strategic trust”. It’s an attempt to curb China’s growing influence, using an asset only Australia has: the world’s top tournament for PNG’s favourite sport.
DAILY POLL
If you had to debut your company on a stock exchange, which would you choose?(listed in order of 2024 IPO ranking)
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Yesterday’s poll: Will Russia and Ukraine mint a peace deal in the coming months?
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🟨🟨🟨🟨🟨🟨 🕊️ Yes, Trump will force Zelensky’s hand (35%)
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🟨🟨🟨⬜️⬜️⬜️ ✌️ Yes, Trump will force Putin’s hand (20%)
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🟩🟩🟩🟩🟩🟩 ❌ No, Putin won’t play ball (35%)
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⬜️⬜️⬜️⬜️⬜️⬜️ 🚫 No, Zelensky won’t play ball (4%)
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⬜️⬜️⬜️⬜️⬜️⬜️ ✍️ Other (write us!) (5%)
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Your two cents:
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🕊️ S.L: ““Zelensky depends on the US to stay in power. Trump will demand either peace, or no cash.”
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❌ C.W: “Putin can’t afford to compromise and look weak at home. Any negotiated peace deal will not accomplish what he wanted and will make it look like he failed.”
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✌️ D.B: “Trump will bring them both to the table and there will be concessions on both sides.”
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✍️ S.B: “The real question is whether the EU or NATO will admit Ukraine. Structural change will be the only real resolution, otherwise Russia will wait a few years and try again.”
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