IPO Roundup April 1, 2016

Lackluster IPO Market Flashes Warning – WSJ

The U.S. stock market has taken off, but it has left behind an important passenger: the IPO.

Major stock indexes have gained about 13% in the past seven weeks and are now in positive territory after a swoon early in the year. The market for initial public offerings, however, is in its slowest period since the first quarter of 2009, both in terms of number of deals and total money raised, according to data provider Dealogic. 

Equitas to kick off its IPO on April 5, first for 2016-17 – The Economic Times

Equitas Holdings will hit the capital markets on Tuesday with its Rs 2,200-crore initial public offering, making it the first public issue of the new fiscal.

The company, with a licence for small finance bank (SFB), has fixed the price band at Rs 109-110 per share.

The IPO consists of a fresh issue of shares aggregating Rs 720 crore and an offer for sale of shares held by P N Vasudevan, MD, and private equity shareholders.

What startup will try to thaw the tech IPO freeze? – MarketWatch

The tech IPO market is officially frozen. Now, we wait for the thaw.

Data issued by Renaissance Capital earlier this week confirmed that yes, the market for tech IPOs is really as bad as it seems, getting off to a nonexistent start this year. The combination of extreme market volatility and the disconnect between startup valuations and Wall Street expectations have closed the window for tech IPOs, for now.

According to research firm Renaissance Capital in Greenwich, Conn., which also manages IPO-focused ETFs, not a single venture-backed tech company went public in the first quarter, the slowest start of the year since the Great Recession. 

CBS plans to spin off radio business with an IPO | New York Post

CBS plans to use the same playbook for spinning off its radio division as it did for unloading its billboard business two years ago, according to the company.

The divestiture of CBS Outdoor began with a public offering of 19 percent of the division’s stock — followed in three months by the distribution of the remaining 81 percent to existing CBS shareholders.

“The primary course of action CBS Corporation is pursuing is to split CBS Radio off via an IPO,” the division’s president, Andre Fernandez, wrote Wednesday in a memo to employees. 

Report: Aramco IPO for Saudi $2 trillion fund

Saudi Arabia plans to sell shares in Aramco, the world’s largest oil company, as a step toward creating what it hopes can be a country-transforming wealth fund.

An initial public offering of less than 5% of Aramco’s parent company could happen as early as next year. Shares would be part of the Public Investment Fund, a growing fund that could help end the kingdom’s dependence on oil, Deputy Crown Prince Mohammed bin Salman told Bloomberg.

“IPOing Aramco and transferring its shares to PIF (the Public Investment Fund) will technically make investments the source of Saudi government revenue, not oil,” the prince said in a five-hour interview this week at the royal compound in Riyadh. “What is left now is to diversify investments. So within 20 years, we will be an economy or state that doesn’t depend mainly on oil.” 

Pop. Vicenza IPO Wobble Adds Risk to Italy’s Fragile Bank Sector – Bloomberg

Banca Popolare di Vicenza SCpA is struggling to draw buyers to its initial public offering, a deal deemed key by regulators to avoid a resolution that would punish creditors and rattle Italy’s financial system.

“If they can’t pull off a successful IPO, the chances of a resolution become greater and that would be bad for the entire Italian banking system, leading to a downward spiral,” said Stefano Girola, who helps manage about 40 billion euros ($46 billion) at Syz Asset Management in Lugano, Switzerland. 

Equitas IPO: first-mover advantage – Livemint

Equitas Holdings Ltd will be the first so-called small finance bank (SFB) to hit the public markets. Being ahead of its peers will help. There are 10 companies that received approval to set up SFBs, and most have large foreign shareholding, which needs to be reduced to 49% to meet the central bank’s norms. Whether these companies tap the public markets or resort to private capital, the fact that they can’t sell shares to foreign investors will make the task challenging. 

‘Dream Home’ Door Maker Jeld-Wen Plans Second Quarter IPO – Bloomberg

Jeld-Wen Inc., the maker of windows and doors that supplies HGTV’s remodelling show “Dream Home,” is planning an initial public offering as early as the second quarter, according to people familiar with the matter.

The IPO could raise about $500 million, valuing the Onex Corp.-backed company at about $5 billion, including debt, said two of the people, who asked not to be identified because the situation is private. Plans are not final and timing may depend on market conditions, they said.

The Klamath Falls, Oregon-based company is starting the process of going public after a quiet start to the year for IPOs. Only nine companies have listed on U.S. exchanges in 2016, as volatility plagues equity markets. Bats Global Markets Inc., the exchange group making its second swipe at a public offering, will begin its roadshow as soon as next week, according to a person familiar with the matter. 

Tegel valued at $552-636m as IPO kicks off | The National Business Review

Analysts appear to have overcooked the value of chicken producer Tegel in their pre-float estimates, figures in its just-lodged prospectus document indicate.

According to the proposed timetable, the broker firm offer for Tegel Group Holdings shares opens on April 20 and closes on April 29, with an expected listing on the NZX and ASX on May 3.

At the indicative price range of $1.55 to $2.50 a share, Tegel will have a market capitalisation of $552-636 million.

Analyst reports seen by NBR last month placed valuation ranges on Tegel of $597-769m (First NZ Capital) and $628-704m (Deutsche Bank). 

IPO market decrepit as going public loses its allure — FT.com

In Corporate America, going public and entering the mighty US stock market is not just a handy way of raising capital, it used to be the ultimate validation of an entrepreneur’s years of hard work and late nights. But the dream appears to be fading.

The US initial public offering market is in the doldrums. This year only nine small companies have listed on US exchanges, but 21 companies were compelled by the market turbulence to shelve their IPOs. Countless more probably refrained from even announcing listing plans. 

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