IPOs This Week: Is Blue Apron Ready to Take on Amazon?
Paul Ausick
Two real estate investment trusts (REITs) and one cable and broadband provider had successful initial public offerings (IPOs) last week. The coming week's calendar includes a total of 10 firms planning to enter the public markets, including one seeking an infusion of $480 million from investors. As of the end of the week, 2017 IPOs have raised more capital than was raised in all of 2016.
Cable and broadband provider Altice USA Inc. (ATUS) entered the public markets last week with the largest telecom IPO since 2000 and the second-largest of 2017. The company raised $1.9 billion with a first-day pop of 9% and closed the week up 14%.
The two commercial REITs, Granite Point Mortgage Trust (GPMT) and Safety, Income and Growth (SAFE), both broke issue on their first trading day and closed the week down 2.6% and 3.6%, respectively.
Through the week ending June 23, IPO ETF manager Renaissance Capital reported that 69 IPOs have priced in the United States so far this year, up about 73% year over year. Total proceeds raised through last week equaled $19.8 billion. For 2016, Renaissance Capital reported a total of 105 IPOs, down 38% year over year from 170 in 2015. Total 2016 proceeds amounted to $18.8 billion compared with a 2015 total of $30 billion. Renaissance Capital does not include “best efforts” or blank-check companies in its totals, nor does it include IPOs that raise less than $10 million.
Among the coming week's IPOs is a "unicorn" meal-kit delivery service and five biotech companies. Here's our rundown on this week's prospective IPOs.
Avenue Therapeutics is a returning specialty pharmaceutical company developing an intravenous synthetic opioid treatment for postoperative pain. The company plans to sell 5 million shares in a reduced price range of $5 to $7 to raise $30 million at an implied market cap of $50 million. Underwriters are Oppenheimer and National Securities. Shares are slated to trade on the Nasdaq under the ticker symbol ATXI.
Esquire Financial Holdings is a New York-based commercial bank holding company. The bank plans to offer 2.4 million shares in an expected price range of $14 to $16 to raise $35 million at an implied market cap of $103 million. The sole underwriter is Sandler O'Neill. Shares are expected to price Monday and begin trading Tuesday on the Nasdaq under the ticker symbol ESQ.
Dova Pharmaceuticals is commercializing a drug candidate to treat low blood platelet counts. The company plans to offer 4.1 million shares in an expected price range of $15 to $17 to raise $65 million at an implied market cap of $394 million. Underwriters are JPMorgan, Jefferies and Leerink Partners. Shares are expected to price Tuesday and begin trading Wednesday on the Nasdaq under the ticker symbol DOVA.
Mersana Therapeutics is a clinical-stage biopharmaceutical firm developing an antibody drug treatment for cancer patients. The company plans to offer 5 million shares in an expected price range of $14 to $16 to raise $75 million at an implied market cap of $340 million. Underwriters are JPMorgan, Cowen, Leerink Partners and Wedbush PacGrow. Shares are expected to price Tuesday and begin trading Wednesday on the Nasdaq under the ticker symbol MRSN.
TPG Pace Holdings is a blank-check company looking to make its first acquisition. The company plans to offer 40 million shares at $10 per unit to raise $400 million at an implied market cap of $500 million. Underwriters are Deutsche Bank, JPMorgan and Goldman Sachs. Units are set to begin trading Wednesday on the New York Stock Exchange under the ticker symbol TPGH.U.
Aileron Therapeutics is a clinical-stage biopharmaceutical company commercializing a novel class of therapeutics called stapled peptides. The company plans to offer 3.8 million shares in an expected price range of $15 to $17 to raise $60 million at implied market cap of $236 million. Underwriters are Merrill Lynch, Jefferies, William Blair and Canaccord Genuity. Shares are expected to price Wednesday and begin trading Thursday on the Nasdaq under the ticker symbol ALRN.
Blue Apron Holdings is a meal-kit delivery company. The firm plans to offer 30 million shares in an expected price range of $15 to $17 to raise $480 million at an implied market cap of $3 billion. Underwriters for the offering include Goldman Sachs, Morgan Stanley, Citi, Barclays, RBC Capital Markets, SunTrust Robinson Humphrey, Stifel, Canaccord Genuity, Needham, Oppenheimer, Raymond James and William Blair. Shares are expected to price Wednesday and begin trading Thursday on the New York Stock Exchange under the ticker symbol APRN.
The recent offer from Amazon.com Inc. (AMZN) to acquire Whole Foods Market Inc. (WFM) could be a threat to Blue Apron's business because Amazon is acquiring more than 400 physical stores, mostly in urban areas, that could serve as distribution centers. Competing against Amazon is difficult at best.
Byline Bancorp is a bank holding company with 56 branches in the Chicago area. The company plans to offer 5.7 million shares in an expected price range of $19 to $21 to raise $114 million at an implied market cap of $568 million. Underwriters include Merrill Lynch, Keefe Bruyette Woods, Piper Jaffray, Sandler O'Neill and Stephens. Shares are set to price Wednesday and begin trading Thursday on the New York Stock Exchange under the ticker symbol BY.
Tintri is an enterprise cloud provider on a range of all-flash storage systems. The company plans to offer 8.7 million shares in an expected price range of $10.50 to $12.50 to raise $100 million at an implied market cap of $357 million. Underwriters include Morgan Stanley, Merrill Lynch, Pacific Crest, Needham, Piper Jaffray, Raymond James and William Blair. Shares are set to price Wednesday and begin trading Thursday on the Nasdaq under the ticker symbol TNTR.
Akcea Therapeutics is a late-stage biopharmaceutical company commercializing treatments for patients with serious cardiometabolic diseases caused by lipid disorders. The company plans to offer 9.6 million shares in an expected price range of $12 to $14 to raise $125 million at an implied market cap of $658 million. Underwriters are Cowen, Stifel, Wells Fargo Securities and BMO Capital Markets. Shares are expected to price Thursday and begin trading Friday on the Nasdaq under the ticker symbol AKCA.
