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25
Year-End 2013 Report
| Regional Trends
EMEA
Capital Raisings
Seventeen issuers raised approximately $4.6 billion in DR form
of which approximately $2.5 billion (or 54%) was in IPO form.
Russia was the most active in IPOs, raising approximately
$1.3 billion, followed by the United Arab Emirates (UAE) and
France raising $380 million and $288 million, respectively.
The largest initial public offering out of the region was TCS
Group Holding of Russia, raising approximately $1.1 billion on
the London Stock Exchange (LSE).
Approximately $2.1 billion was raised by nine issuers in
follow-on offerings, accounting for 46% of all capital raisings
from the region. Russia was most active in follow-on offerings,
raising $1.3 billion. The largest follow-on offering was by Mail.
ru Group from Russia, raising approximately $532 million.
Trading Volumes
DR trading volumes decreased by 7% (or 5.3 billion DRs) with
72.4 billion DRs traded in 2013 versus 77.7 billion DRs during
prior year. Most of the decrease was largely due to lower
trading volumes of LSE-listed programs (3.6 billion DRs) and
NYSE-listed programs (1.9 billion DRs). In terms of countries,
programs from Russia (3.7 billion DRs), France (1.3 billion DRs)
and Finland (1.1 billion DRs) accounted for a majority of the
decrease.
New Programs
1, 2
Forty-one new sponsored programs were announced from
EMEA: eight U.S.-listed ADRs (five listed on the NASDAQ
and three listed on the NYSE-Euronext), 26 Level 1 ADRs and
seven GDRs (including bifurcated programs). South Africa was
the most active region with eight new programs (six Level 1
ADRs and two U.S.-listed ADRs), followed by Russia with
four new programs (two GDRs, one U.S.-listed ADR and
one Level 1 ADR).
TCS Holdings Group from Russia (LSE) was the most notable
IPO transaction from the region.
Unsponsored Programs
Total trading volumes for EMEA unsponsored programs were
down by 9% (84 million DRs) with 880 million DRs traded
in 2013 versus almost 924 million DRs in 2012. France, UK,
Switzerland and Germany were the most active countries,
comprising 72% of total unsponsored trading volume and
45% of unsponsored program count in the region. Overall,
total trading volume for EMEA unsponsored programs
decreased mainly due to decreased trading volumes of
programs from Italy (88 million DRs) and France (16 million
DRs), which was offset slightly by increased trading volumes
of programs from the UK (39 million DRs).
Market Performance
Citi Depositary Receipt Services maintains the EuroPac
Liquid DR Index (CLDREPAC) and EMEA Liquid DR Index
(CLDREMEA) to gauge investor sentiment toward EMEA.
During 2013, CLDREPAC appreciated by 18% and CLDREMEA
depreciated by 5%, performing lower to the S&P 500
index. On a long-term basis, since 2001, CLDREMEA has
outperformed the S&P 500, while the CLDREPAC index has
underperformed the S&P 500.
At the end of 2012, the French Financial Transaction Tax
(FFTT) became effective on ADRs. French ADR programs that
met specified criteria became subject to FFTT. Other markets
are also currently exploring implementing a similar Financial
Transaction Tax (FTT) — with Italy being one country to
implement its own FTT in 2013. While FTT is likely to adversely
impact liquidity, its exact impact on DRs remains to be seen.
1
For bifurcated programs, Reg S and 144A tranches have been counted as
separate programs.
2
Program count as of December 2013.