VANCOUVER (miningweekly.com) – Initial public offerings (IPOs) on Canadian stock exchanges took a breather during the first quarter of this year, as issuers and investors digest a slew of relevant factors such as the implications of interest rate hikes, recent US tax changes, market volatility and threats to world trade, professional services firm PwC noted on Monday.

However, the firm sees a healthy pipeline for IPOs that point to an uptick in activity for the balance of the year – if the market can see beyond all of the short-term disruption.

PwC pointed out in a news release on Monday that the list of potential new issues stands in stark contrast to a quarter that saw just nine new issues completed on all exchanges for a value of C$157-million. This compares with the total value of IPOs in the first quarter of 2017 reached C$571-million from six new equity issues across all Canadian exchanges — the second-best initial quarter result in the past decade, the PwC survey reported.

The first quarter of this year saw one issue completed on the TSX with a total value of C$150-million. The CSE contributed three issues and the Venture added five with a total value of C$7-million.

"A slow first quarter is really pretty normal. With the rush of activity at the end of last year, it isn't surprising to see the market taking stock – particularly in light of the extreme volatility we saw in the quarter. I also believe the market is still assessing the implications of the new US tax regime. The outlook for the Nafta negotiations and US trade sanctions, and interest rates are all giving issuers lots to consider,” PwC national IPO leader Dean Braunsteiner stated.

The sole issue on TSX in the first quarter was the IPO of Pinnacle Renewable Holdings – an industrial wood pellet manufacturer and distributor and the first issue from the energy sector this year.

“What has carried over from last year is the slow improvement in activity in the mining sector, where seven new issues were registered on the CSE and Venture Exchange," Braunsteiner said.

Despite PwC’s survey not counting reverse takeovers by private firms as IPOs, as many as 12 companies took that route to public ownership in the period.

"Some companies perceive it as an easier, less expensive route to going public. That's debatable. But while it isn't a significant number overall, reverse takeovers represent a channel that bears watching, particularly as new entrants in the busy cannabis sector jockey for a place in public markets," Braunsteiner noted.