Companies held 21 DR offerings globally in the first half of this year, raising a combined $3.8 bn, led by increased activity from pharmaceutical and biotech companies, according to BNY Mellon.
Capital raised is down sharply from the first half of last year, when 41 capital market transactions raised a combined $9.1 bn, BNY Mellon says in its mid-year report. It beats the first half of 2013, however, which saw $3.6 bn raised in 20 transactions.
Pharmaceutical and biotech firms accounted for 14 of the transactions in the first half of this year, raising a combined $1.3 bn, or almost a third of the proceeds. DR trading volumes, meanwhile, rose to their highest in four years, with the number of DRs traded rising 8.6 percent from the same period last year to 81.6 bn and the cash value increasing by 4.9 percent to $1.57 tn, BNY Mellon says.
Banking was the most traded sector, with 14.5 bn DRs valued at $129.2 bn. Oil, gas and consumable fuels was next, with 14 bn DRs valued at $205.2 bn, followed by the metals & mining sector, which saw 11 bn DRs traded and a total value of $114.3 bn.
‘While investors these first six months weathered market volatility as well as concerns such as the Greek debt crisis and growth rates in China, DR trading numbers rose to their highest levels in four years,’ says Christopher Kearns, CEO of BNY Mellon’s DR business, in a press release. ‘The continued enthusiasm for DR listings suggests global investors recognize how DRs can help diversify their portfolios to suit a variety of market conditions.’
The EMEA region was the most active, with 11 offerings raising more than $1.4 bn in the first half of 2015. The BNY Mellon Classic ADR Index series shows healthcare leading in terms of DR performance, with a gain of 8.8 percent from the year-ago period, followed by consumer services at 7.9 percent and consumer goods at 7.6 percent.
