(Bloomberg) -- Europe is getting its groove back -- when it comes to initial public offerings. The continent led global IPO volume by a wide margin in the first quarter, raising almost $20 billion in the period as stock benchmarks surged. The activity stands in contrast to takeovers in Europe, which slumped by about one-fifth. Europe’s IPO fundraising -- from companies including Auto Trader Group Plc and Aena SA -- outpaced that in the U.S. and Asia-Pacific combined, data compiled by Bloomberg show, and the region was the only one of the three where IPO volume increased from a year earlier. For the U.S., the first three months of the year were the slowest since 2009. Even with Web domain-name company GoDaddy Inc. scheduled to raise more than $400 million in New York on the last day of the quarter, that won’t change. To a certain extent, Europe is catching up as central bank policy, low oil prices and a lower euro stir investor optimism. Last year, European offerings lagged the U.S., even excluding Alibaba Group Holding Ltd.’s record $25 billion IPO. The Stoxx Europe 600 has gained 15 percent this year, while the Standard & Poor’s 500 Index was unchanged. “There’s clearly a rotation under way out of the U.S. and into Europe,� said David Hermer, global head of equity capital markets at Credit Suisse Group AG. “Investors are seeming a bit more cautious on the U.S. economy at the same time the market’s trading at all-time highs, and investors are becoming more optimistic about the core of Europe.� Economic Growth The economic environment is helping: The European Central Bank’s quantitative-easing program, lower oil prices and a weaker euro compared with the dollar are a “big stimulus� for many companies that are reporting stronger earnings as a result, said Christoph Stanger, co-head of equity capital markets for Europe, the Middle East and Africa at Goldman Sachs Group Inc. “It took Europe much longer than the U.S. to re-open fully after the financial crisis, particularly on the IPO front,� Stanger said. ’’That has finally changed.’’ State Sales Five companies in Europe raised more than $1 billion in IPOs this quarter, compared with one in the U.S. The largest European IPO was a state selldown and that trend could continue as more governments sell assets. Spanish airport operator Aena raised 4.3 billion euros ($4.7 billion) in a public listing last month, Europe’s biggest IPO in almost four years. Auto Trader Group, the Manchester, U.K.-based digital marketplace for vehicles, raised $2.4 billion in March, the largest in the U.K. since Royal Mail Plc’s $3 billion offering in 2013. In the U.S. meanwhile, the largest deal was the $1.2 billion IPO of Columbia Pipeline Partners LP, a natural gas pipeline unit spun off by NiSource Inc. While the second quarter should be stronger for the U.S., it won’t break any records, according to Credit Suisse’s Hermer. “I do expect the U.S. IPO flow to pick up some, but I don’t expect it to be a bumper quarter,� he said. “I think there will be less issuance in IPOs this year than last year.� In Europe, ABN Amro Group NV, the state-owned lender, is planning to sell shares to the public this year, seeking a valuation of at least 15 billion euros, acccording to Dutch Finance Minister Jeroen Dijsselbloem. In Germany, U.S. buyout firm Advent International Corp. is prepping cosmetics and perfume chain Douglas Holding AG for an IPO, people familiar with that situation said last month. “We’re seeing a robust pipeline across the street with lots of activity in different sectors and geographies,� said Craig Coben, co-head of global equity capital markets at Bank of America Corp. “The IPO market is seen as a more viable exit channel than M&A in some cases.� To contact the reporters on this story: Ruth David in London at rdavid9@bloomberg.net; Leslie Picker in New York at lpicker2@bloomberg.net To contact the editors responsible for this story: Mohammed Hadi at mhadi1@bloomberg.net; Aaron Kirchfeld at akirchfeld@bloomberg.net Elizabeth Wollman

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