This edition of the Bermuda Public Companies Update summarises significant transactions involving Bermuda public companies in the first half of 2020. This has been a period of unprecedented disruption due to the Covid-19 pandemic. Despite a very difficult and uncertain economic climate, Bermuda listed companies collectively managed to raise more capital in H1 2020 than H1 2019. This is a testament to the strength and resilience of the listed Bermuda corporates, which has been supported by investor confidence in Bermuda as a jurisdiction. Conyers is consistently recognised as the leading Bermuda law firm advising Bermuda public company issuers and underwriters.
Global market update
Global capital markets activity in H1 2020 was heavily impacted by the Covid-19 pandemic and associated economic slowdown. IPO activity declined across all regions, compared with H1 2019. In the Americas, both IPO deal volume (81 deals) and proceeds (US$24.5 billion) fell by 30% compared with YTD 2019. After a very slow April and May, the market saw a strong rebound in June as lockdowns eased. Nearly a third of the IPOs in H1 2020 occurred in June. Technology, industrials and health care were the dominant sectors.
Global mergers & acquisitions (M&A) activity was similarly impacted. All regions witnessed a decline in deal volume and value except for Asia-Pacific, and South and Central America, which witnessed growth in deal value. Overall, according to data from Refinitiv, Q1 2020 was the worst first quarter for M&A since 2016, down 13% from a year ago. Parties to pending M&A transactions have been considering their options. While some have moved forward with planned mergers or acquisitions, others have put plans on hold or terminated agreements.
Bermuda companies update
Some US$11 billion in capital was raised in the first half of 2020 by Bermuda companies listed on the NYSE and Nasdaq. Despite the disruptions caused by Covid-19, this is up from US$8.2 billion for the same period in 2019. The increase was primarily driven by the insurance sector, as we discuss in our feature article on page 3. Other significant market activity included sizeable notes offerings by Nabors Industries Ltd, Norwegian Cruise Line Holdings Ltd, Axalta Coating Systems Ltd and GeoPark Limited.
There was one Bermuda company IPO on a US exchange in the period – GAN Limited, a gambling software provider, began trading on Nasdaq on 5 May 2020 under the ticker symbol GAN. The company was previously listed on the AIM market operated by the London Stock Exchange, but delisted as of 6 May 2020.
Blue Capital Reinsurance Holdings Ltd delisted from the NYSE at the end of March.
M&A activity was significantly down from 2019 levels in terms of volume of transactions. Among the most significant, Helen of Troy acquired Drybar Products LLC for approximately US$255 million and International General Insurance Holdings acquired Tiberius Acquisition Corporation in a US$120 million reverse merger transaction. The new entity, IGI Holdings, listed on Nasdaq in March.
We hope this update on Bermuda public companies market activities will be of interest to our legal colleagues, clients and Bermuda market followers.