Author: Gordon Platt





Companies based in Brazil, Russia, India and China, known as the BRIC countries, accounted for 53% of new depositary receipt programs and 52% of capital raised in DR form in the first 11 months of 2008, according to a J.P. Morgan year-end report published on December 10. The BRIC countries will continue to be key participants in the DR markets in 2009, the report says.

Overall capital raised in DR form globally fell to $14.5 billion in the first 11 months of 2008 from $57.3 billion in the full year 2007. “Not surprisingly, the DR market has not been immune to the overall global financial crisis; as our figures demonstrate, new sponsored DR issuances are down markedly, and capital-raising activity has decreased substantially,” says Claudine Gallagher, global head of J.P. Morgan’s DR business. “At the same time, however, we have seen tremendous [trading] volume in the DR market, particularly in the last three months, and we have a very solid queue of issuer IPOs ready to launch once the global markets are less turbulent,” she says.

Renewed interest is expected from the Middle East markets in 2009, the report says. Other non-traditional markets, such as Vietnam, are expected to emerge. In May 2008 Global Investment House raised $1.15 billion in global depositary receipts and became the first Kuwait-based company to list GDRs on the London Stock Exchange. In Asia last year, solar energy was the leading sector in terms of capital raised via DRs.





Gordon Platt