IPOs, Initial Public Offerings: pre & post IPO

Summary: April 23rd week

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6 new IPOs, 2 holdovers

NEW for April 23rd week
Two are China-based

Acquity Group
Based in the Cayman Islands with operating companies in China, Acquity Group (proposed AQ) scheduled a $50 million IPO with a market capitalization of $212 million at a price range mid-point of $9 per ADS for Friday, April 27, 2012. One ADS represents two shares.

Manager, Joint Managers: Citigroup; Oppenheimer.

AQ is a digital marketing company (ad agency) with current clients in the US. AQ plans to expand in the US, in China and in Europe. In 2011, AQ derived over 70% of revenues from clients that were clients in the previous year.

China Auto Rental
Based in Beijing, China, China Auto Rental (proposed CARH) scheduled a $126 million IPO with a market capitalization of $794 million at a price range mid-point of $11.50 per ADS for Wednesday, April 25, 2012.
One ADS represents 4 common shares.

Manager, Joint Managers: Morgan Stanley; J.P. Morgan; BofA.

CARH is the largest car rental company in China. CARH says it has a clear leadership position across substantially all major operating metrics including fleet size, network coverage and number of customers.
See chart of the top 10 car rental companies in China as of December 31, 2011 in China here. S-1, page 87.

Four are U.S.-based
Ares Commercial Real Estate
Based in Chicago, Illinois, Ares Commercial Real Estate (proposed ACRE) scheduled a $150 million IPO with a market capitalization of $180 million at a price range mid-point of $19.50 for the week of April 23, 2012.

Manager, Joint Managers: Wells Fargo; Citigroup; BofA Merrill; J.P. Morgan.

This is a start-up REIT that acquired four mortgages from December, 2011 through March 2012, sponsored by an alternative investment manager with $46 billion in assets. It’s not hard to acquire those kind of mortgages to put into a REIT, especially with assistance from IPO underwriters.

Edgen Group
Based in Baton Rouge, Louisiana Edgen Group (proposed EDG) scheduled a $225 million IPO with a market capitalization of $353 million at a price range mid-point of $15 for Friday, April 27, 2012.

Manager, Joint Managers: Jefferies; Morgan Stanley; Citigroup.

Dull distributor to the energy market, cobbled together by private equity sponsored acquisitions. EDG plans on selling 62% of the company on the IPO – that’s a bad sign. Profit margin for the March 2012 quarter is estimated to be .8%, very thin.

The organization structure is convoluted. IPOdesktop doesn’t like complicated organizational structures. See the organization structure here. S-1, page 12.

Envivio
Based in South San Francisco Envivio (proposed ENVI) scheduled an $85 million with a market capitalization of $294 million at a price range mid-point of $11 for Wednesday, April 25, 2012.

Manager, Joint Managers: Goldman; Deutsche; Stifel Nicolaus.

ENVI believes it is in one of the fastest growing components of the $3.0 billion video infrastructure market: IP video processing and distribution solutions.

For the year ended January 2012 revenue was up 70% to $51 million from $30 million. EVNI has been marginally profitable the last three quarters and shows good sequentially quarter revenue growth.

Supernus Pharmaceuticals
Based in Rockville, Maryland, Supernus Pharmaceuticals (proposed SUPN) scheduled a $75 million IPO with a market capitalization of $256 million at a price range-mid-point of $13 for Wednesday, April 25, 2012.

Manager, Joint Managers: Citigroup; Piper Jaffray.

SUPN is a specialty pharmaceutical company with product candidates for epilepsy & Attention Deficit Hyperactivity Disorder ADHD, with lots of competition in both product segments.

SUPN generated $39 million in operating losses for the year ended December 31, 2011. SUPN’s IPO is to fund further clinical trials.

TWO HOLDOVERS
In the IPO market a ‘holdover’ is a company that was unsuccessful selling its IPO on the date originally scheduled, usually due to lower than expected demand, which is a negative.

Enerkem’s (NRKM) $130 million IPO is rescheduled for the week of April 23, 20912, from April 4, 2012. NRKM’s first SEC IPO filing was February 3, 2012.

Luca Technologies’s (LUCA) $102 million IPO is rescheduled for the week of April 23, 2012. from its original date of Friday, March 30, 2012. LUCA’s first SEC IPO filing was June 29, 2011.

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