Industry News

BP launches IPO for new Houston business

British oil and gas giant BP said Monday it commenced a planned initial public offering for its new Houston-based pipeline spinoff, BP Midstream Partners.
BP said the IPO puts up for sale 42.5 million units that are priced between $19 and $21 each, meaning that BP hopes to generate more than $800 million through the launch of the new business.
The goals are to raise more money, attract new investors, and bring more value to its pipeline assets. The midstream business primarily will house BP’s Gulf Coast and Midwest assets, specifically its Gulf of Mexico pipelines, processing and storage capacity connecting its deepwater Gulf platforms to Louisiana, as well as its pipeline assets and more affiliated with its Whiting refinery in Indiana.
The new business will trade on the New York Stock Exchange under the “BPMP” stock ticker symbol. BP Midstream will have a Houston headquarters with additional offices in Chicago. BP will continue to own more than 53 percent of the midstream business after the IPO is completed.
BP originally said in July it was considering turning its U.S. pipeline business into a publicly traded master-limited partnership, which is a uniquely American tax-avoiding corporate structure that requires the companies to distribute most of their income to investors in payments similar to stock dividends.
Out of the so-called “Big Oil” giants, only Royal Dutch Shell already has an MLP, having launched Shell Midstream Partners in 2014.

Saudis Consider Delaying Foreign Part of Aramco IPO

Another plan would include listing in Riyadh next year and privately selling a stake in Aramco to one or several cornerstone investors, one of the people said.
Glencore Plc sold in 2009 a stake through a convertible bond ahead of its 2011 IPO, still the largest ever in London where the company raised nearly $10 billion.
Despite the work on alternative plans, Saudi Arabia said earlier this month that schedule for the blockbuster initial public offering wasn’t “slipping” and the country still planned a sale by the end of 2018.
If Saudi Arabia achieves its valuation, the 5 percent stake it plans to sell would raise about $100 billion.
London and New York exchanges are vying for a role in Aramco IPO, with Hong Kong, Singapore, Tokyo and Toronto also trying to attract the sale. The Financial Conduct Authority, the U.K. markets regulator, on Friday defended a proposal to change listing rules that would make it easier for Saudi Aramco to list in London.
To read a story on the FCA and Aramco, click here.
Saudi Aramco has hired JPMorgan Chase & Co., Morgan Stanley, HSBC Bank Plc, Moelis & Co. and Evercore Inc. to advise on the IPO.

Sogou, Mobile Search Rival Of Baidu And Alibaba, Files For IPO

While Sogou’s initial filing said it aims to raise up to $600 million, management has previously talked about an IPO raising $4 billion to $5 billion.
Sohu (SOHU) is Sogou’s controlling shareholder while social media giant Tencent Holdings (TCEHY) also owns a stake. Sogou’s relationship with Tencent is key, given the popularity of its WeChat social media app, analysts say.
In its IPO filing, Sogou said it is the second largest search engine by mobile queries in China, according to iResearch.
Baidu by all accounts is the biggest mobile search engine by far while either Alibaba-backed Shenma or Sogou are No.
Sogou said had revenue of $373.2 million during the first six months of 2017, up 15% from $322.9 million a year ago.
So it pays to identify and track companies that are getting ready to go or have recently gone public. IBD also focuses on the best-performing IPOs of the past three years in its IPO Leaders column. “In October 2017, Tencent began testing the integration of Sogou search into Weixin/WeChat, whereby its users can use Sogou search as a general search function,” said Sogou in its filing.
The filing went on to say: “We intend to discuss commercial arrangements with Tencent after completion of product testing and optimization.

5 ways tech startups are avoiding IPOs

Last week’s debut of data-center company Switch Inc. SWCH, -4.41% brought in half a billion dollars for the third-largest tech IPO this year, and streaming-video device maker Roku Inc. ROKU, +3.18% saw its valuation double in its first two trading days.
Uber Technologies Inc., Airbnb Inc., Pinterest Inc., Palantir Technologies Inc. and Dropbox Inc. are just a handful of companies valued at $10 billion or more in venture capital investments that have not publicly filed for an IPO, and there are dozens more companies with valuations of more than $1 billion.
Instead, many of those so-called unicorns are looking for any other avenues to raise funds, avoiding the type of roller-coaster performance Snap has experienced, which could show that companies’ lofty private valuations could mean a harsher reception from public investors when a deal gets to market. Even with the recent rebound in its shares, Snap still is trading below its IPO price of $17.
Through three quarters, 20 tech IPOS have raised $6.7 billion, according to Renaissance Capital, compared with 16 tech IPOs that raised $2.1 billion in the same period in 2016. There have been 121 total IPOs in the U.S. so far this year, raising $31.2 billion, compared with 102 total deals in 2016, raising $21.6 billion, according to data from PwC.
In 2014, ethereum raised $18 million in bitcoin and is now trading with a market cap of about $19 billion.
WeWork Companies Inc., which rents shared office spaces, received $4.4 billion from the SoftBank Vision Fund that valued the startup at $20 billion, and its chief executive explained that valuation in a way that probably would not fly on Wall Street.

General Insurance Corporation IPO opens today: Should you invest in India’s third-biggest IPO?

In 2008, Reliance Power raised Rs 11,700 crore and two years later in 2010, Coal India raised Rs 15,200 crore through public offerings. This will also be the first time when India’s primary market will see public offering by a reinsurer player in the country.
In the state-owned GIC Re IPO , the government will sell 107.5 million shares, while the company will raise funds by selling 17.2 million new shares.
The estimated market valuation of the corporation, as per the market, will be around Rs 1,00,000 crore.
The second largest PSU bank in term of market capitalization is Bank of Baroda, which is at Rs 71,017 crore. After Coal India in 2010, GIC will be the largest PSU IPO that will be listed on the domestic bourses.
State Bank of India has the highest market capitalization of Rs 2.42 lakh crore followed by OIC, ONGC, Coal India and others.
While the issue looks good, there are also risk in the re-insurance space as the exposure of GIC is increasing big time in the agriculture sector. “It’s a high risk business,” says a market player. In fact, global players are allowed underwrite business in India without setting up a brick and mortar office.

Zhaoqing Piston Machinery Announces Its Initial Public Offering on ASX to Raise $14 Million

SYDNEY, Oct. 10, 2017 /PRNewswire/ — Chinese companies continue to show great interest in Australian Securities Exchange with Zhaoqing Piston Machinery Ltd listing on ASX in the coming weeks. Its sights are firmly set on securing its place in the manufacture of cast iron products for the automotive industry while securing its strong position in the household air-conditioner compressor component market.
With our new investment, we are confident that we can build a strong foothold in that sector.’
Piston was among the first foundries to be certified to continue manufacturing under the new national environmental and technical standards. Piston has also been accredited as a New and High Technology Enterprise by the Chinese government which enables the company to receive preferential tax rates.
The past 3 years (2014 – 2016) has seen Piston’s revenue growing at a CAGR of 5.84% reaching $53.4 million in 2016, its gross profitability staying above 20% and its EBIT at 10.3%, 12.6%, and 12.9% over the consecutive years.
The IPO price is A$0.40 per share with the number of shares on offer between 37 and 50 million.
Piston plans to enter automotive cast iron parts manufacturing to further its business growth.
Anyone considering participating in the Offer should read the Prospectus in full and will need to complete an application form which accompanies the Prospectus.

Aquantia Corp. Files Registration Statement for Proposed Initial Public Offering

SAN JOSE, Calif.–(BUSINESS WIRE)–Aquantia Corp. announced today that it has publicly filed a registration statement with the U.S. Securities and Exchange Commission relating to a proposed initial public offering of shares of its common stock.
Needham & Company and Raymond James are acting as co-managers.
A registration statement relating to these securities has been filed with the Securities and Exchange Commission but has not yet become effective. These securities may not be sold nor may offers to buy be accepted prior to the time the registration statement becomes effective. This press release shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of these securities in any state or jurisdiction in which such offer, solicitations or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.
Copies of the preliminary prospectus relating to the offering may be obtained, when available, from: Morgan Stanley & Co. LLC, Attention: Prospectus Department, 180 Varick Street, 2nd Floor, New York, NY 10014; from Barclays Capital Inc., c/o Broadridge Financial Solutions, 1155 Long Island Avenue, Edgewood, NY 11717; and from Deutsche Bank Securities Inc., Attention: Prospectus Group, 60 Wall Street, New York, NY 10005.
Aquantia’s products are designed to cost-effectively deliver leading-edge data speeds for use in the latest generation of communications infrastructure to alleviate network bandwidth bottlenecks caused by the growth of global IP traffic.

Cramer unpacks Switch’s IPO, the second-largest tech IPO of the year

CNBC’s Jim Cramer rarely fails to notice new players arriving on the data center scene, which is why Switch’s initial public offering, the second-largest tech IPO of 2017, caught his attention.
That’s a 22 percent gain right out of the gate,” the “Mad Money” host said.
Moreover, 95 percent of Switch’s revenue, which grew by 17 percent in the first half of 2017, is recurring, meaning the company offers its data centers as a service.
Cramer took some issue with Switch’s complicated ownership structure.
Roy’s ability to call all the shots at Switch worried Cramer from an investing perspective, since public shareholders who buy into the stock risk getting overlooked or under-served. “You never want any company to be that dependent on a single customer, but the data center business tends to be pretty sticky.
But the data center play’s 2018 prospects seem promising: it’s opening a new data center campus in Atlanta, and Switch’s sales routinely soar higher after it opens a new data center.
I do love the data center, and I like Switch the company even with the convoluted ownership structure,” Cramer said. That said, call me a believer in the concept.
Questions for Cramer?

MAS Financial IPO fully subscribed on first day

New Delhi: The initial public offering (IPO) of MAS Financial Services Ltd was subscribed 1.05 times on Friday, the first day of the shares sale.
As of 6.15pm, the IPO received bids for 7,531,808 shares against the total issue size of 7,124,910, according to data available with BSE. The IPO will close on 10 October.
The Gujarat-based firm plans to raise Rs2,275 crore through the share sale with a price band of Rs456-459 per share. The IPO includes a fresh issue of Rs233 crore. The proceeds from the fresh issue will be used to augment its capital base to meet future capital requirements.
Analysts said the valuations of the non-banking finance company (NBFC) which lends to middle and lower income segments are reasonable. “At the upper band of the issue, the company trades is offered at 3.6 times post issue book value of Rs130 which is fairly priced in our view compared to peers,” said Prabhudas Lilladher Pvt.

MAS Financial IPO subscribed 49% so far on Day 1

MAS Financial Services has fixed a price band of Rs. 456-459 per share for its initial share sale offering, through which it is estimated to raise Rs. 460 crore.
The initial public offer (IPO) will be open for public subscription during October 6-10, MAS Financial Services had said in a statement.
MAS Financial is a Gujarat-headquartered non-banking financial company (NBFC) with more than two decades of business operations and presence across six states and the NCT of Delhi.
The public issue comprises fresh issue of shares worth up to Rs. 233 crore and an offer for sale of up to Rs. 227 crore by existing shareholders. 135 crore.

Three Winston-Salem companies receive funding from Creative Startups accelerator

The accelerator program, which took place in Winston-Salem for the second time, was held by the Center for Creative Economy.
Creative Startups in Winston-Salem focuses on mentoring startups in creative industries with the goal of helping the companies move towards a customer base and profitability. Companies from Cambridge, Mass and Los Angeles were also among those competing.
“Accelerator participants receive eight weeks of intensive business skills training to help jumpstart their businesses,” said Margaret Collins, executive director for the Center for Creative Economy.
Jenni Earle Design, which makes southern-inspired, hand-dyed bandanas, received $15,000.
The Dream School, an afterschool and summer program that uses podcasts, digital video and coding to improve students’ learning skills, received $10,000.

Metropolitan Bank Holding Corp. Files Registration Statement for Proposed Initial Public Offering

The number of shares to be offered and the price range for the proposed offering have not yet been determined.
A registration statement relating to these securities has been filed with the Securities and Exchange Commission but has not yet become effective. These securities may not be sold nor may offers to buy be accepted prior to the time the registration statement becomes effective. This press release shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of these securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.
The offering will be made only by means of a prospectus. Copies of the preliminary prospectus related to the offering may be obtained, when available, from J.P. Morgan Securities LLC, c/o Broadridge Financial Solutions, 1155 Long Island Avenue, Edgewood, NY 11717 Attention: Prospectus Department, or by calling 866-803-9204, or from Keefe, Bruyette & Woods, Inc., Attention: Equity Capital Markets, 787 Seventh Avenue, 4th Floor, New York, NY 10019; or by calling Keefe, Bruyette & Woods, Inc. toll-free at (800) 966-1559.

OrthoPediatrics sets price range on IPO, could bring in up to $64m

OrthoPediatrics yesterday priced the range on its initial public offering, looking to float 4 million shares of common stock at between $12 and $14 per share, which would bring in between $48 and $56 million.
The offering also includes a 30-day underwriter’s option to purchase an additional 600,000 shares of common stock, bringing the possible total the company could raise in the offering up to $64.4 million.
Warsaw, Ind.-based OrthoPediatrics currently produces 21 surgical systems designed to support orthopedic trauma and issues and said it has plans to expand its offerings into additional categories, including the foot and ankle, hand and wrist, clavicle, pelvis and sports-related injuries.
Funds from the offering are slated to pay accumulated unpaid dividends on its Series B preferred stock, to invest in implants and instrument sets for consignment to its customers and for R&D, sales expansion and general corporate purposes, the company said in a press release.
OrthoPediatrics said it has applied to the NASDAQ Global Market under the ticker symbol “KIDS.” Piper Jaffray & Co. and Stifel, Nicolaus & Co. are acting as joint book-runners for the offering.

Saudi Aramco IPO carries significant execution risk, top regulator says

Mohammed El-Kuwaiz, chairman of the Saudi Arabian Capital Market Authority, told CNBC Friday: “The main risks are around execution. Whenever you have something which has this high an aspiration level, and this tight a timeline, the challenge is to get it done and get it done with the right level of quality.”
His comments come in the wake of a Bloomberg report suggesting the Aramco IPO could be pushed back to 2019 due to the large amount of preparatory work that still needs to be completed ahead of the listing. Aramco hit back at the claim, stating the IPO “remains on track”.
The Saudi government is yet to announce whether Aramco’s primary listing will be in London or New York, but it has decided that a portion of the firm will be floated on the country’s domestic stock index the Tadawul. “We’ve found very few gaps in our local regulations and we’re actually ready with minimal changes to accommodate the Aramco IPO or any other big listing,” he told CNBC.
The new thinking is to deregulate the market and open it up for foreign investors.”
Most notably, it has made it possible for investors to short-sell equities listed on the country’s stock exchange and helped introduce a corporate governance code which prohibits public companies from combining the roles of chairman and CEO.
Saudi Arabia is hoping the attention generated by the Aramco IPO will lead to a pick-up in the number of non-domestic companies listing on its markets.

Rovio Announces Results Of Its Initial Public Offering

Rovio Entertainment Ltd, the software giant behind the popular Angry Birds games on Android, has now reported its market valuation and initial funds raised following the company’s initial public offering (IPO). This follows news from earlier in the month which suggested the company would follow through on plans to take the company public. As to the company’s plans for the gains from the IPO, the company says that those will be used to grow the company, including through initiatives to boost brand recognition and to consolidate its position in the gaming industry. Having the company listed publicly should also aid in that effort, since the move should provide both the brand and the company’s projects with more visibility.
Regarding the specifics of Rovio’s IPO, the company’s shares were set at a price of €11.50 (or around $13.60) per share – which is at the upper end of the initial range. That resulted in the company raising around €30 million ($35.6 million) as a result of the IPO, while around €458 million ($541.5 million) went to majority owners, which are reported to include Trema International, Accel Partners, and Atomico. Meanwhile, the new market valuation for Rovio Entertainment Ltd had been set at €896 million, which is around $1.06 billion in U.S. dollars, ahead of its IPO on September 29.

Roku IPO valuation nearly doubles in two sessions

Don’t miss: After booming IPO, Roku thinks this is the future of the company.
It was the biggest debut for a large IPO so far in 2017, according to Dealogic data.
With 94.75 million total shares outstanding, the stock’s $12.54 rise off the IPO price adds about $1.19 billion in market cap to the company, to nearly double the pre-IPO valuation of $1.33 billion.
Roku had revenue of $398.7 million in 2016, compared with $1.19 billion for GoPro and $2.17 billion for Fitbit.
See also: Roku IPO: 5 things to know about the streaming device company.
On Friday, GoPro’s stock was trading at less than half its IPO price and Fitbit shares were trading at about one-third the IPO price.
“The last time a tech company had a higher first day of trading was the Sep 2016 IPO of Nutanix which rose 131% on its first day of trading,” said Renaissance Capital’s IPO ETF manager Kathleen Smith, in emailed comments, pointing out that while Nutanix Inc. NTNX, -0.18% is now 40% above its initial IPO price, it’s a far cry from its initial rally.

Roku IPO: Company sets 2017 record as shares soar

And then came Roku.
After popping 44 percent in its much-anticipated public offering in March, Snap shares on Thursday were down 15 percent from their IPO price.
The company’s share price flatlined during its first day on the public market, and on Thursday was trading at barely more than half its IPO price.
Roku raised $219 million in its IPO late Wednesday, pricing 15.7 million shares at $14 — the high end of the $12-$14 target range the company set last week.
Like many Silicon Valley tech companies entering the public market, Roku is not profitable. Roku pulled in $398.6 million in revenue last year, up 25 percent from the year before.
Roku’s IPO comes on the heels of a dismal year for Silicon Valley IPOs. At the time, analysts expected the market to bounce back in 2017, and pointed to the growing number of massive private companies that eventually will need to go public to return money to their investors.
Prior to Roku’s offering, 18 tech companies turned public this year, down from 21 at this time last year, according to Renaissance Capital.
The average return on IPOs priced this year is about 24 percent, Smith said.

OV2 Investment 1 Inc. Announces Completion of Initial Public Offering

Following the completion of the Offering, the Company has 10,000,000 Common Shares issued and outstanding, 3,000,000 of which are subject to escrow restrictions as disclosed in the Prospectus. Trading of the Common Shares on the TSXV commenced at the opening of business on 28th day of September 2017, under the symbol “OVO.P”.
The board of directors of the Company consists of Sheldon Pollack, Adam Adamou, Eric Apps and Babak Pedram. The officers of the Corporation are Sheldon Pollack and Adam Adamou. Except as specifically contemplated in the CPC policies of the TSXV, until the completion of its “Qualifying Transaction” (as defined therein), the Company will not carry on business, other than the identification and evaluation of companies, business or assets with a view to completing a proposed “Qualifying Transaction”.
Although the Company believes that the expectations reflected in these forward-looking statements are reasonable, undue reliance should not be placed on them as actual results may differ materially from the forward-looking statements. Factors that could cause the actual results to differ materially from those in forward-looking statements include failure to fulfill conditions of listing on the TSXV and inability to obtain required regulatory approvals.