Daily Management Review

Wall Street banks make over $650M on IPOs in a week


Last week was the most active week for initial public offerings on US exchanges since 2004. 14 firms earned at least $100m each and Wall Street banks earned $650m on their IPOs.

Public Domain Pictures
Public Domain Pictures
The past week was the busiest for the US stock market in terms of the number of companies going public since 2004, writes CNBC. During it Wall Street banks earned more than $650 million in fees and profits on shares. 

A total of 14 firms earned at least $100 million each in last week's IPO on the NYSE and Nasdaq, the busiest IPO week in 17 years. The underwriters received about $400m in fees to help with the IPO. Another $259M in proceeds will come from their options to purchase the outstanding shares at a discount to the IPO. 

In last week's IPOs, underwriting fees ranged from 2% of total funds raised (in the case of Chinese taxi ordering service Didi) to 7% for smaller deals (offerings by medical companies CVRx, Aerovate Therapeutics, Acumen Pharmaceuticals). Goldman Sachs and Morgan Stanley generated the highest fee income, acting as lead managers for the Didi IPO and cybersecurity software provider SentinelOne, the two largest IPOs of the week.

source: cnbc.com