Capital Raising through DRs Picks Up in Third Quarter, Led by Asian Companies,
says BNY Mellon
Q3 DR Market Update shows Asia still dominates capital-raising activity;
Investor demand continues for new emerging and frontier market programs
NEW YORK, Oct. 17, 2013
NEW YORK, Oct. 17, 2013 /PRNewswire/ --Capital raising by companies using
depositary receipts (DR) picked up modestly in the third quarter, led by
offerings from Asia-based firms and rising to more than $5.6 billion through
the first nine months of the year, according to BNY Mellon's DR Market Update.
Companies coming to market ranged across sectors, from traditional industrials
to alternative energy, and raised more than $2.0 billion during the quarter,
up from $1.4 billion in Q2.* Fubon Financial Holding Co. led with a global
depositary receipt (GDR) offering in July of $850 million. Fubon was one of
three offerings from Asia in Q3, along with ReneSola and JA Solar of China,
where BNY Mellon acted as depositary. Companies from the region have accounted
for more than $2.6 billion, or nearly half, of the global capital raised
"Third quarter activity builds on the momentum created earlier in 2013 with
China's LightInTheBox IPO and Japan's UBIC capital raising," said Christopher
M. Kearns, CEO of BNY Mellon's Depositary Receipts business. "We're seeing a
steady uptick in the companies coming to market as well as investor appetite
for those offerings, both from developed and developing countries. Depositary
receipts continue to serve as the bridge for efficient cross-border
Outside of Asia, discount airline Volaris staged a roughly $500 million
initial public offering in the year's first dual-listing from Mexico, listing
certificates of ordinary participation in Mexico and ADRs on the New York
Stock Exchange. South African transport software and hardware management
company MiX Telematics launched an IPO in August, listing ADRs on the NYSE and
raising just over $100 million.
To meet investor demand for new emerging and frontier market stocks, BNY
Mellon established 'unsponsored' DR programs in the third quarter for
companies such as Zambia's Copperbelt Energy Corp. and Zambeef, and South
Africa's Famous Brands and Lewis Group.
DRs typically represent non-U.S. ordinary shares and trade on traditional and
over-the-counter (OTC) markets and stock exchanges.
Top Company and Country DR Index Performers*
Asia-based companies dominated the list of top-performing individual DR
programs through September, several of which saw their DR price more than
quadruple year-to-date, including Taiwan's Inotera Memories and Himax
Technologies, or triple in value, such as China's JinkoSolar. The best
overall performing DR through the first nine months was Denmark's Vestas Wind
Systems, up 341%, fractions of a percentage point ahead of South Korea's
Through September the top-performing BNY Mellon country index, comprising DRs
from locally based companies, was Argentina (+37%), followed by Japan (+23%),
according to the BNY Mellon Classic ADR Index^SM Series. Returns on indices
for Western European countries, such as Switzerland, the Netherlands, France
and Spain, rounded out most of the top 10. As the only real-time index to
track all ADRs, New York shares, and global registered shares traded on the
NYSE, NASDAQ and over-the-counter, the BNY Mellon Classic ADR Index is a
widely used international benchmark.
Third Quarter Highlights*:
oThe most actively traded DRs globally by value included China's Baidu, the
U.K.'s Vodafone, Brazil's Vale and Petrobras, BP, Russia's Gazprom and
Sberbank, Finland's Nokia, and Mexico's America Movil.
oThe top 10 DRs in terms of price performance year-to-date include a 341%
leap by Denmark's Vestas Wind Systems and South Korea's Hanwha SolarOne,
followed by China Sunergy (323%), Taiwan's Inotera Memories
(320%),Taiwan's Himax Technologies (+317%), and then China's JinkoSolar
(263%) and Trina Solar (+256%), a 230% gain seen in the U.K.'s Thomas
Cook, followed by China's YY Inc. (+228%) and ReneSola (+224%).
oThe BNY Mellon Classic ADR Index^SM Series, which tracks the performance
of depositary receipts by country of origin, showed Argentina leading with
price gains of 37% year-to-date, followed by Japan (+23%), Switzerland
(+20%), Netherlands (+19%), France (+18%), Spain (+16%) and Germany
oThe most active industries year-to-date were Commercial Banks with 17
billion DRs traded, valued at $194 billion, followed by 16 billion Oil,
Gas & Consumable Fuels DRs valued at $289 billion, Metals & Mining issuers
with just over 15 billion DRs traded worth $236 billion, 12 billion
Communications Equipment DRs valued at $50 billion, followed by
Semiconductor issuers trading 9 billion DRs totaling $111 billion.
oGlobally, there were 108 billion DRs valued at $1.9 trillion traded,
representing decreases of 3% and 7%, respectively, compared with the same
period last year.
oWestern Europe saw more than 35 billion DRs traded, valued at $718
billion, followed by Latin America where 30 billion DRs traded in the
third quarter worth $460 billion, Asia Pacific had 23 billion DRs worth
$466 billion change hands, Eastern Europe saw 17 billion DRs bought and
sold in transactions totaling $172 billion, and the Middle East and
Africa, where 3.7 billion DRs traded totaling $57 billion.
BNY Mellon acts as depositary for more than 2,700 American and global
depositary receipt programs, acting in partnership with leading companies from
68 countries. BNY Mellon is committed to helping securities issuers access the
world's rapidly evolving financial markets and delivers a comprehensive suite
of depositary receipt services. Learn more at www.bnymellon.com/dr
BNY Mellon is a global investments company dedicated to helping its clients
manage and service their financial assets throughout the investment lifecycle.
Whether providing financial services for institutions, corporations or
individual investors, BNY Mellon delivers informed investment management and
investment services in 35 countries and more than 100 markets. As of Sept. 30,
2013, BNY Mellon had $27.4 trillion in assets under custody and/or
administration, and $1.5 trillion in assets under management. BNY Mellon can
act as a single point of contact for clients looking to create, trade, hold,
manage, service, distribute or restructure investments. BNY Mellon is the
corporate brand of The Bank of New York Mellon Corporation (NYSE: BK). Learn
more at bnymellon.com, or follow us on Twitter @BNYMellon.
*Trading and company performance data: Bloomberg as of 9/30/ ^ 2013. Country
DR Index data: BNY Mellon and S&P Dow Jones Indices as of 9/30/2013.
This release is for informational purposes only. BNY Mellon provides no advice
nor recommendation or endorsement with respect to any company or securities.
Nothing herein shall be deemed to constitute an offer to sell or a
solicitation of an offer to buy securities. Depositary Receipts: Not FDIC,
State or Federal Agency Insured; May Lose Value; No Bank, State or Federal
Agency Guarantee. BNY Mellon provides no advice nor recommendations or
endorsement with respect to any company, security or products based on any
index licensed by BNY Mellon, and we make no representation regarding the
advisability of investing in the same.
Contact: Joseph F. Ailinger Jr. Dori Flanagan
+1 617-722-7571 +1 212-815-2291
SOURCE BNY Mellon
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