Market watches Oaktree IPO for seeds of hope

PRIVATE equity house Oaktree Capital Management will fire the starting gun on an estimated $2.2bn (£1.38bn) listings bonanza in the US this week.

The Los Angeles buyout group is one of eight firms due to price shares, stirring hopes of a revival in the moribund market for initial public offerings (IPOs).

Energy and industrial companies feature strongly, including waste-to-biofuel firm Enerkem and Erickson Air Crane, but Oaktree’s move to go public will attract most interest as the market looks for clues to the IPO by private equity giant Carlyle Group planned for later this quarter.

Oaktree, which had about $75bn in assets under management at the end of last year, expects an offering of 11.3m Class A shares to be priced between $43 and $46 each.

Co-founders Howard Marks and Bruce Karsh could pocket up to $117.2m each by selling a slice of their stakes in their debt-focused private equity firm.

Proceeds from US-listed IPOs fell by nearly 60 per cent to $6.5bn in the first quarter from a year ago but analysts are more upbeat about the current period.

Phil Drury, co-head of equity capital markets in the Americas at Citigroup, said: “We feel constructive about the US economic landscape for equities and IPOs.”

The other firms due to price shares this week are aluminium producer Aleris Corp, industrials company MRC Global, oil and natural gas development product maker Forum Energy Technologies, solar thermal power plant developer BrightSource Energy and clean energy firm Luca Technologies.