TUMBLING equity markets prompted 24 companies globally this month to halt plans for initial public offerings, the most in at least a decade.
Tommy Hilfiger Corp, the fashion brand owned by London-based buyout firm Apax Partners Worldwide LLP, Denmark's Dong Energy A/S, and Chinese department store operator Maoye International Holdings Ltd are among companies that have withdrawn or postponed sales, according to data compiled by Bloomberg News.
"Unless we have a fairly dramatic shift, the IPO market is going to be pretty dormant," said Chris Kelly, head of the capital markets practice at law firm Jones Day in New York. "IPO investors don't want to buy into an investment that has a decent likelihood of going down."
The MSCI World Index fell 14 percent since reaching a record on October 31 as subprime-mortgage defaults sparked a worldwide credit crisis and threatened to send the United States economy into recession.
Wide trend
The Bloomberg IPO Index, which tracks new stocks in their first year of trading, dropped nine percent in the past year, while the Standard & Poor's 500 Index declined 6.4 percent.
Mexico, Sweden, France, Poland and Australia are among the more than 40 countries whose benchmark indexes have slumped more than 20 percent from their highs of 2007, the common definition of a bear market.
Europe's Dow Jones Stoxx 600 Index has tumbled as much as 24 percent from a six-year high on June 1. In the US, the S&P 500 dropped 14 percent from its record reached in October.
Apax bought Hilfiger in 2005 for US$1.6 billion after its red-white-and-blue-splashed clothing lost favor with teenagers. Tommy Hilfiger, which first went public in 1992, had planned to return to the market by listing shares in Amsterdam.
The market decline also derailed the IPO of Dong Energy, which would have been Denmark's biggest in more than a decade.
Solargiga Energy Holdings Ltd and SFK Construction Holdings Ltd canceled Hong Kong IPOs worth as much as a combined HK$3.3 billion (US$423 million).
In the US, the largest deal to fail was the US$345 million sale of Imperium Renewables Inc, a biodiesel producer.