Week’s issues could make year biggest for IPOs since 2000
This could be the biggest week of the year for initial public stock offerings.
Twenty-two companies are expected to sell shares, including Burger King’s biggest U.S. franchisee, Carrols Restaurant Group Inc.
The sales could help make this the hottest year for IPOs since 2000. So far, a total of $44.7 billion has been raised by 205 companies.
What’s more, investors have been well rewarded in the average new issue: The Bloomberg IPO index, which tracks new stocks’ returns in their first year of trading, has surged nearly 38% this year.
Recent hot deals include an offering last week by Heelys Inc., a Carrollton, Texas-based manufacturer of wheeled sneakers for children.
Heelys on Thursday sold 6.4 million shares at $21 each. The stock rocketed to close at $32.60 on Friday, a 55% gain. On Monday the shares slipped $2.20 to $30.40.
Companies hoping to sell stock this week are seeking to raise a total of $3.2 billion.
Carrols plans to raise as much as $240 million for its owners, including buyout firm Madison Dearborn Partners and a unit of Bahrain International Bank.
The company, based in Syracuse, N.Y., is the largest Burger King franchisee and also owns and operates two Latino fast-food brands, Pollo Tropical and Taco Cabana. Carrols plans to sell 15 million shares at $14 to $16 each; its private-equity backers are seeking to slash their stakes.
Another firm hoping to come to market is NewStar Financial Inc., which specializes in loans of $5 million to $17.5 million for medium-sized companies. The Boston company plans to sell 11 million shares at $15 to $17 each.
NewStar was founded in 2004 by Timothy Conway, former head of debt underwriting at FleetBoston Financial Corp. Other owners include Capital Z Partners Ltd. and JPMorgan Corsair II Capital Partners, both private-equity investors, and hedge fund Och-Ziff Capital Management.
In the energy sector, Cal Dive International Inc. of Houston plans to sell 22 million shares at $14 to $16 each. The company provides diving services to energy producers in the Gulf of Mexico.
San Diego-based Artes Medical Inc. expects to sell 4.6 million shares at $12 to $14 each. The company is developing injectable products for the dermatology and plastic surgery markets.
Genesis Lease Ltd., a newly formed aircraft-leasing company, could be this week’s largest deal. It plans to raise as much as $641 million. The Irish company is offering 27.9 million American depositary shares at $21 to $23 apiece.
Other offerings on the calendar include IPG Photonics Corp., a fiber optic laser manufacturer based in Oxford, Mass.; U.S. BioEnergy Corp., an ethanol producer based in Inver Grove Heights, Minn.; and Affymax Inc., a Palo Alto-based biotech firm.
The list of IPO hopefuls includes some so-called blank-check companies created solely to find an acquisition or merger partner. One of them, Atlanta-based Middle Kingdom Alliance Corp., is offering two classes of shares to finance an as-yet-unspecified acquisition in China.
The IPO market tends to dry up in the second half of December because of the holidays, said Tom Taulli, founder of Newport Beach-based website DealProfiles.
“It’s almost like, at the end of the year, you have to throw it all out there,” he said of this week’s deals.
