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US IPO Recap: Twitter launches $1.3 billion IPO
Analyst IPO Blog
) launched the most anticipated IPO of the year last week, seeking to raise $1.3 billion at a price range of $17 to $20. Seven other companies, including retail chain The Container Store (
), also set terms. Four IPOs were completed, but only one resulted in a positive return. Five companies, each with less than $100 million in annual sales, were added to the pipeline.
Three IPOs see negative returns
All four IPOs last week priced below the range, and three produced negative returns on their first days of trading, which was partly attributable to their relatively low growth rates. CommScope (
) completed the largest deal of the week, raising $577 million, and closed one cent below its offer price of $15. The Carlyle-backed company provides connectivity solutions for wireless, enterprise and residential broadband networks. Endurance International (
) had the worst return of the week, falling 6%. The Warburg Pincus and Goldman Sachs-backed company provides web hosting, domain services and other cloud solutions to 3.4 million small and mid-sized businesses around the world. Sprague Resources LP (
), which owns 15 refined products and materials handling terminals, traded down 1%. Aerie Pharmaceuticals (
) was the only IPO to post a positive return, rising 6%. Led by former executives of ISTA Pharmaceuticals and Bausch + Lomb, Aerie is developing two treatments for glaucoma, one of which is entering Phase 3 trials in 2014.
IPO pricings (week of October 21, 2013)
Deal Size ($mm)
Price vs. Midpoint
Return as of 10/25
Aerie Pharmaceuticals (
Sprague Resources LP (
Endurance International (
SMB web services
Twitter kicks off roadshow for November 6 IPO
On Thursday, Twitter revealed the terms of its
. The microblogging service will offer 70 million shares at a price range of $17 to $20 for estimated proceeds of $1.3 billion. Revenue increased 106% to $422 million for the nine months ended September 30, 2013, and adjusted EBITDA rose to $31 million. The platform now has more than 215 million monthly active users, who post approximately 500 million Tweets per day. The pricing is reportedly set for November 6, with trading to begin on Thursday, November 7.
Seven others set terms
After Twitter’s billion-dollar offering, last week’s largest new deal was Avianca Holdings’ (
) proposed $504 million deal. Avianca, a Panama-based Latin American airline, booked $4.4 billion in sales for the 12 months ended June 30. The last airline to go public, Mexico-based Volaris Aviation (
), is up 11% since its IPO in September.
The Container Store (
), a national retail chain that sells storage and organization products, launched a $188 million IPO. Controlled by private equity firm Leonard Green, it has 63 stores spread across 22 states and has achieved positive comps in 13 consecutive quarters.
IPOs setting terms (week of October 21, 2013)
Deal Size ($mm)
LTM Sales ($mm)
Avianca Holdings (
Latin American airline
Essent Group (
The Container Store (
Marcus & Millichap (
Barracuda Networks (
Mavenir Systems (
Two Chinese tech firms are among five companies added to pipeline
Last week’s five new
pushed the month’s total to 30. Two of the five came from Chinese companies 500.com (
) and Sungy Mobile (
). 500.com is an online sports lottery service provider with 18 million registered users. Sungy Mobile provides applications and mobile platform development products and services. Its revenue increased 87% to $23 million in the first half of 2013. While Chinese IPOs have been scarce in the last few years, highly anticipated deals from 58.com (
) and Qunar.com (
) could help open the market when they price this week. Another technology company, Varonis (
), filed for a $100 million IPO. Varonis is an unstructured data specialist that helps companies manage their security, archiving and other data-related needs.
New IPO filers (week of October 21, 2013)
Deal Size ($mm)
LTM Sales ($mm)
American Petroleum Tankers LP (
Chinese sports lottery
Unstructured data software
Sungy Mobile (
Recro Pharma (
IPO market snapshot
The 173 IPOs in 2013 have raised $41.0 billion and produced an average return of 37%. There have been 63 IPOs in the past 90 days, with total proceeds of $17.5 billion and an average return of 31%. The active IPO pipeline includes 121 companies looking to raise a total of $34.0 billion.
Keywords / Tickers: US IPO Market,
Recently Priced IPOs
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As stated in the Prospectus, the total annual operating expenses for the Fund was 3.48%. The Adviser has contractually agreed to keep net expenses from exceeding 2.50% of the Fund's average daily net assets for at least a year from the date of the Prospectus and for an indefinite period thereafter subject to annual re-approval of the agreement by the Board of Trustees.
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is a stock market index based upon a portfolio of U.S.-listed newly public companies that includes securities prior to their inclusion in core U.S. equity portfolios. The
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Risk Disclosure: Investments in the
Renaissance IPO ETF, symbol "IPO"
Renaissance International IPO ETF, symbol "IPOS"
(the "ETFs"), and the
Global IPO Fund, symbol "IPOSX"
(the "Mutual Fund") are subject to investment risk, including possible loss of the principal amounts invested. The ETFs and the Mutual Fund (the "Funds") invest in companies that have recently completed initial public offerings. These stocks are unseasoned equities lacking trading history, a track record of reporting to investors and widely available research coverage which many result in extreme price volatility. Due to a greater number of IPOs in certain segments, the Funds may also be subject to information technology and financial sector risk, small and mid-capitalization company risk, and, for the Renaissance International IPO ETF, emerging markets risk. The Funds may hold securities in the form of Depository Receipts, REITs, and Partnership Units which have greater risks than common shares. The strategies have high portfolio turnover and securities lending risks. The returns of the ETFs may not match the return of the respective indices. The ETFs are classified as non-diversified investment companies subject to concentration risk.
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Definitions: The Renaissance IPO Index® is a stock market index based upon a portfolio of U.S.-listed newly public companies that includes securities prior to their inclusion in core U.S. equity portfolios. The S&P 500® Index is a stock market index based on the market capitalizations of 500 large companies whose common stock is publicly traded on the NYSE.
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