March 30 (Bloomberg) -- In a year heralding the landmark initial public offering of Facebook Inc., share sales got off to a slow start.
While more companies tapped equity markets in March, IPOs globally raised $16.2 billion in the first quarter, the least since 2009, data compiled by Bloomberg show. That kept the backlog of deals in the U.S. near the highest in more than a decade, according to Renaissance Capital LLC.
Investors are still smarting after losing money last year on IPOs from Groupon Inc. to Glencore International Plc, even as U.S. stock market volatility fell to an almost five-year low in the quarter and set the stage for a rebound. Share sales in the U.S., Asia and Europe picked up in recent weeks, led by Allison Transmission Holdings Inc. and Dutch cable-television operator Ziggo NV.
“People are still waiting to see that the IPOs that are coming out now are going to work,” said Joe Reece, global head of equity capital markets at Credit Suisse Group AG. “The market has definitely been improving, especially during March, but people still have a healthy degree of skepticism about the IPO market overall.”
The most recent companies to hold share sales have been rewarded by investors, with about two-thirds trading above their offer price, the data show. That contrasts with Glencore, which held its IPO in May and had lost 27 percent of its value since that time, before today. Online coupon provider Groupon had dropped 12 percent since going public in November.
More companies may be looking to take a cue from Facebook, which is planning a $5 billion IPO in early May, according to people with knowledge of the matter. A share sale by the Menlo Park, California-based company would be the biggest offering for an Internet company in history.
“It’s going to push interest in the broader IPO market,” said Francis Gaskins, president of Ipodesktop.com in Marina Del Rey, California. “Companies will want to IPO at that time if they can, while people are paying attention to the IPO market.”
Nine companies raised $1.4 billion in U.S. IPOs this week, the most weekly initial offers in the country since December 2010, Bloomberg data show.
Carlyle Group LP and Michaels Stores Inc., the arts and crafts retailer owned by Blackstone Group LP and Bain Capital LLC, are also planning IPOs this year, according to people familiar with the situation. Oaktree Capital Group LLC, the distressed-debt investor co-founded by Howard Marks, filed today to raise as much as $517.5 million in its IPO.
In the U.S., consumer-review website Yelp Inc. already raised $123 million in its IPO this month and has almost doubled since its debut. Vantiv Inc., the payment processor partly owned by Fifth Third Bancorp, sold $575 million in stock this month. The shares have advanced 18 percent since they began trading March 22.
Improving economic prospects are helping spur investor demand for new stocks, according to equity capital markets bankers. U.S. gross domestic product expanded at a 3 percent annual rate in the fourth quarter, the fastest pace in more than a year, and the U.S. unemployment rate has fallen to the lowest level in three years. That helped push the measure of U.S. stock volatility known as the VIX to its lowest level since June 2007.