A Harvest Year for Equities in 2005

Activity in the public equity market was absolutely blistering in 2005 – and not just in New York. Amazingly, we decided to select three winners among the dozens of deals done last year and as it turned out each was listed on a different continent!

As you can see from Figure 1, equity issuance topped out with $7 billion of new equity coming into the business from the outside, nearly half of that coming from outside of America. If shipping is a cyclical business in which there are planting years and harvest years, then 2005 was the biggest harvest of all time.

When you factor in five times leverage, global equity sources contributed about $42 billion of buying power to the global shipping industry – nearly doubled the typical annual volume.

When combined with the torrent of fresh liquidity that was also entering the business from the high charter market, shipbrokers from Shanghai to Oslo tell us that it was enough to drive asset prices higher than they would have gone without this cash infusion.

This is only an excerpt of A Harvest Year for Equities in 2005

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