The market for initial public offerings (IPOs) continues to weaken at a time when tight credit conditions have companies struggling to shore...

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The market for initial public offerings (IPOs) continues to weaken at a time when tight credit conditions have companies struggling to shore up capital.

IPO activity typically slows down in bear markets. This time, the credit crisis is making investors even more reluctant to support a traditionally high-risk market.

Year to date, 43 IPOs have been completed, compared with 172 at the same time in 2007, according to Renaissance Capital’s IPOHome.com.

What’s more, 69 companies have withdrawn or postponed their offerings, compared with 13 in the 2007 period.

However, the pipeline of potential deals remains strong. “Filing activity has been abnormally high relative to the level of successful IPOs,” write IPOHome.com analysts in a recent research report, “supporting a deal backlog much larger than it was as the bottom of the 2001 to 2003 IPO drought.”

As of Aug. 28, there were 129 companies, excluding special-purpose acquisition companies, or SPACs, in the pipeline.

The high number may be due to the credit crisis. As more companies have difficulty securing new loans, they are turning to the equity market for capital.

“It is unlikely that filings will continue at their current pace unless pricing activity shows signs of life,” the report says.

“We could be in store for a pipeline shakeout much like in 2001, when 149 deals were withdrawn, though many of these were smaller Internet companies that missed the boom.”

If market conditions were to improve, however, the heavy backlog creates the potential for a buyer’s market.

“Toward the end of the last recession, it was a great time to be a selective buyer in the IPO market,” says Sam Snyder, senior research analyst at Renaissance Capital.