*

Promising pipeline of anticipated initial public offerings

*

Large IPOs expected to dominate, appealing for liquidity

and

strong performance

*

Tech companies may attract investors despite smaller size,

says

Goldman Sachs CFO

By Echo Wang, Tatiana Bautzer, Saeed Azhar

NEW YORK, Jan 10 (Reuters) - Investment bankers are

gearing up for a pickup in dealmaking activity in global equity

capital markets this year, buoyed by a promising pipeline of

anticipated initial public offerings of several high-profile

companies.

Liquefied natural gas producer Venture Global, privately held

medical supply giant Medline, and cybersecurity company

Sailpoint, backed by private equity firm Thoma Bravo, are

expected to headline a crowded line-up of stock market

flotations in the first half of 2025, according to people

familiar with the matter.

An increase in capital markets activity, driven by improving

economic confidence, is expected to be a major boon for several

of these private equity-backed companies.

Private equity firms have been struggling to sell or list

portfolio companies over the past two years due to high interest

rates and volatile stock markets that put a chill on

dealmaking.

"Many of the companies owned by private equity firms have

become sizeable," said Arnaud Blanchard, global co-head of

equity capital markets for Morgan Stanley. "Sponsors know it may

take a while to complete a full exit, so they are becoming

active now, early in the cycle."

Other buzzy names that could potentially go public in the U.S.

this year include the likes of Swedish payments firm Klarna,

artificial intelligence cloud platform CoreWeave, and financial

technology firm Chime, which confidentially submitted paperwork

for its flotation in December, the sources said.

The largest private equity firms have become more bullish about

IPOs of their portfolio companies in recent months.When major

U.S. banks report earnings next week, investors will focus on

the outlook for capital markets, which had a surge of activity

last year.

Global equity issuance rose 20% last year, but stock market

launches have so far lagged that increase, remaining far below

their 2021 peak. IPOs raised $123 billion last year, compared

with a record-breaking haul of $594 billion in 2021, according

to Dealogic.

Moreover, Wall Street's most-watched gauge of investor anxiety,

the Cboe Volatility Index, is currently 18, raising

expectations of a near-term upswing in capital markets.

LARGER DEALS

Bankers are expecting more large IPOs, which typically refer

to share sales worth $750 million and above, and are appealing

because they often feature established companies with strong

financial performance and offer greater liquidity to investors.

"IPOs, on average, are likely to be larger in size perhaps

than they ever have been," Brian Friedman, president of

Jefferies, told Reuters in an interview.

Bankers also expect the 2025 surge in IPOs to reach across

a broad swathe of sectors.

"Investors continue to favor scaled, profitable companies

with sensible balance sheets and durable cash flows, especially

as rates may be staying higher for longer," said Matt Warren,

Bank of America's head of Americas equity capital markets cash

origination.

While valuations have risen, many startups backed by private

equity firms are still falling short of their targeted returns,

said JPMorgan Chase president Daniel Pinto.

"A lot of the companies in the sponsor books, even with

these valuations, are not able to produce a good enough exit for

these investments," he said. "Private equity firms can unlock

value in several ways, including small stake sales in IPOs,

which can then be used for a strategic sale with a premium."

Tech companies may buck the trend, attracting demand from

investors even if they are smaller in size, Goldman Sachs Chief

Financial Officer Dennis Coleman said during the firm's

financial conference in December.

The Wall Street investment banking giant has a "substantial

tech pipeline" of IPOs and expects to see offerings for

fast-growing companies to rebound after strong performances from

recent small and mid-cap tech IPOs.