Tags: initial | ipo | investing

IPO Market Picks Up; $1.1 Billion on Tap This Week

Sunday, 24 October 2010 12:54 PM

Companies are seeking to raise at least $1.1 billion through U.S. initial public offerings next week, the most since July, after a rebound in stocks lifted IPOs from Vera Bradley Inc. to NetSpend Holdings Inc.

First Wind Holdings Inc., the Boston-based developer and operator of wind energy projects backed by D.E. Shaw & Co., will offer as much as $312 million in shares in the week’s biggest deal, according to data compiled by Bloomberg. Shanghai-based online retailer Mecox Lane Ltd. and Le Gaga Holdings Ltd., a Hong Kong-based vegetable producer, are selling shares after Chinese companies accounted for six of the ten biggest gains among U.S. IPOs this year.

IPOs rallied this week, with five of six offerings posting gains of at least 13 percent in their first day of trading, as the Dow Jones Industrial Average climbed above its highest close since the month that New York-based Lehman Brothers Holdings Inc. collapsed in 2008. U.S. stocks have advanced in seven of the past eight weeks as companies from Citigroup Inc. to Google Inc. reported earnings that beat analysts’ estimates.

“The market is coming back quite strongly,” said Josef Schuster, the Chicago-based founder of IPOX Capital Management LLC, which oversees $3 billion. “Earnings are coming out quite well, and underneath some of these recent IPOs is a relatively strong earnings picture, and that’s driving” gains, he said.

First Wind, which operates projects selling power from New England to California, will offer 12 million Class A shares for $24 to $26 each on Oct. 27, according to filings with the Securities and Exchange Commission and data compiled by Bloomberg. The company will use the proceeds to help pay down debt and fund project development, the filing showed.

Credit Suisse Group AG of Zurich, New York-based Morgan Stanley and Goldman Sachs Group Inc. and Deutsche Bank AG in Frankfurt are leading the IPO. D.E. Shaw, the New York-based hedge-fund firm started by David Shaw, will see its stake of Class A shares reduced to 52 percent from 100 percent after the sale, the SEC filing showed.

Mecox Lane is offering 11.7 million American depositary receipts at $8 to $10 each in an Oct. 25 sale led by Credit Suisse and Zurich-based UBS AG. Le Gaga will sell 10.9 million ADRs at $7.50 to $9.50 apiece on Oct. 28. Charlotte, North Carolina-based Bank of America Corp. and UBS are arranging Le Gaga’s sale.

Six Chinese companies have rallied at least 80 percent after their IPOs this year. The country’s economy will grow 9.6 percent in 2011, according to estimates from the Washington- based International Monetary Fund. That compares with 2.2 percent for developed nations and 2.3 percent for the U.S.

Pacific Biosciences of California Inc., the Menlo Park, California-based maker of gene-mapping systems, is seeking to raise $213 million in an offering led by JPMorgan Chase & Co. and Morgan Stanley in New York on Oct. 26, SEC filings show.

ExamWorks Group Inc., the Atlanta-based provider of medical legal services, is selling 10.3 million shares at $16 to $18 each on Oct. 27. Goldman Sachs, Credit Suisse and Barclays Plc of London are leading the offering.

SeaCube Container Leasing Ltd., the Park Ridge, New Jersey- based container leasing company, may raise $135 million the same day. JPMorgan and Citigroup in New York, Deutsche Bank and San Francisco-based Wells Fargo & Co. are arranging the sale.

Vera Bradley, the Fort Wayne, Indiana-based maker of women’s handbags, and TAL Education Group, which offers after- school tutoring services in Beijing, led this week’s rally in IPOs, climbing more than 50 percent in their first day of trading. NetSpend, the Austin, Texas-based provider of reloadable prepaid debit cards, advanced 18 percent.

Aegerion Pharmaceuticals Inc., the Bridgewater, New Jersey- based biopharmaceutical company that develops drugs treating lipid disorders, advanced 14 percent today after pricing 5 million shares at $9.50 each, SEC filings show. Aegerion was originally offering 4.7 million for $14 to $16.

The share-price gains were a sign that the IPO market may be rebounding after at least 54 companies withdrew or postponed initial sales this year amid concern that the recovery from the longest recession since the Great Depression was deteriorating. No American company has raised more than $700 million in an initial offering this year, data compiled by Bloomberg show.

The S&P 500 has rallied 16 percent from its 2010 low in July as investors speculated the Federal Reserve will pump more cash into the economy and earnings topped analyst estimates at 86 percent of the companies in the index that have reported third-quarter results since Oct. 7.

Companies from Smart Technologies Inc. of Calgary to RealD Inc., the Beverly Hills, California-based the maker of 3-D movie projectors used to show James Cameron’s “Avatar,” raised a combined $1.15 billion excluding overallotment options in the week ended July 16, data compiled by Bloomberg show.

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Companies are seeking to raise at least $1.1 billion through U.S. initial public offerings next week, the most since July, after a rebound in stocks lifted IPOs from Vera Bradley Inc. to NetSpend Holdings Inc.First Wind Holdings Inc., the Boston-based developer and operator...
Sunday, 24 October 2010 12:54 PM
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