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Third-quarter IPO Activity Remains Strong
 

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Oct. 5, 2004--Fourteen venture-backed U.S. companies completed initial public offerings in the third quarter, representing the largest third-quarter total since 2000, according to a new report.

The third-quarter total marked a slight downturn from the second quarter of 2004, which saw 24 companies go public, according to VentureOne, a unit of Dow Jones. While the number of IPOs decreased from last quarter, the third-quarter total still equaled the second highest quarter on record since 2000.

The third-quarter number brings to 48 the total of IPOs so far this year, a figure that already exceeds the sum of IPO activity for 2002 and 2003 combined, according to the report. But the pace remains far short of the dot-com heyday of 1999 and 2000, in which the number of annual public offerings averaged 226. During those two years, four consecutive quarters witnessed 70 or more IPOs.

The report said that third-quarter IPO activity this year raised a total of $1.72 billion and was led by the well-publicized public offering of Google, which at $1.2 billion accounted for two-thirds of the quarterly total. The median amount raised in an IPO this quarter was $41.6 million, while the median amount invested prior to the offering was $52.4 million.

VentureOne reported that level of third-quarter mergers and acquisitions involving U.S. venture-backed companies also kept pace with the first two quarters. Ninety venture-backed U.S. companies were merged or acquired in the third quarter, for a total of $5.89 billion, with information-technology companies representing the majority of those deals. Third-quarter M&A transactions raised a median amount of $36.5 million, compared with a $24.6 million median amount invested prior to acquisition. The average age of those companies involved was five years.





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