The IPO Buzz: Flying the Tech IPO Skies

The Nasdaq Composite closed on Friday, March 30, at 3,091.57, up 18.7 percent from Friday, Dec. 30, 2011. The S&P 500 closed on Friday, March 30, at 1,408.47, up 12 percent for the first quarter and consequently, the year, while the Dow Jones Industrial Average closed on Friday, March 30, at 13,212.04, up 8.14 percent for the first quarter – and the year to date.

 

But the Nasdaq Composite is more than just a stock market index. Some consider the Nasdaq Composite the barometer of the IPO market. The index is heavy laden with technology issues, much like the IPO calendar. What’s more, many IPOs are listed on the Nasdaq and traded on that market.

 

On the wings of the Nasdaq Composite Index, 2012’s IPO market took flight.

 

The calendar turned out 41 IPOs in the first quarter of 2012, according to the U.S. Securities and Exchange Commission filings. The last time more IPOs were priced during a year’s first quarter was in 2007, when 44 companies went public. And 2007 was a good year for IPOs. A total of 256 companies made their public debuts.

 

The IPO Graduating Class of 2012 has done well. On Friday, March 30, 36 IPOs had closed above their initial offering prices, while five were below, and the average gain for all 41 was 32.8 percent.

 

Worth noting: In the first quarter, the heart of the new-issues market was technology. Twelve technology IPOs were priced, 11 were winners, and two were the best of the class. (For details, click on: 2012 Pricings.)

 

Now let’s take a look at this week.  The calendar has four deals and one is a carryover from last week. None are in the technology sector.

 

Once upon a time, Rumpelstiltskin stayed up all night to spin straw into gold. One of the companies going public this week intends to take his act and update it for the 21^st century. Its specialty? Turning trash into fuel.

 

Enerkem plans to price 7.25 million shares at $17 to $19 each on Tuesday evening. The IPO is expected to start trading Wednesday morning on the NASDAQ Global Market under the proposed symbol “NRKM” and on the Toronto Stock Exchange under the proposed symbol “NKM.”

 

Based in Montreal, Enerkem develops renewable biofuels and chemicals by using solid waste from numerous municipalities and other types of feedstock. The Canadian company takes trash such as plastics, textiles or wood, which can’t be recycled, and turns it into ethanol or other fuels or chemicals. The development-stage company says its clean technology will decrease the amount of trash in landfills, increase the supply of renewable fuels and chemicals, and reduce greenhouse gas emissions. Incorporated in 2007, Enerkem has about 136 employees. As of Dec. 31, 2011, the company had an accumulated deficit of C$51.7 million (or US$51.7 million.)

 

Enerkem expects to have about 28.2 million shares outstanding after the offering.

 

Erickson Air-Crane  plans to price 5.35 million shares at $13 to $15 each on Tuesday evening. The IPO is expected to start trading Wednesday morning on the NASDAQ Global Market under the proposed symbol “EAC.”

 

Based in Portland, Oregon, Erickson Air-Crane manufactures the Erickson S-64 Air-Crane, considered one of the world’s most versatile, powerful and efficient heavy-lift helicopters. Fighting wild fires, lifting electrical transmission towers into place and logging are among the typical activities where an Erickson S-64 Air-Crane helicopter comes in handy. The “S” in the helicopter’s name stands for Sikorsky, the original manufacturer. Known as the “Tarhe” when it was used by the U.S. Army, this helicopter was a workhorse during the Vietnam War. In 1992, Erickson bought the type certificate to two Sikorsky S-64 model Skycranes and changed the designation to the “S-64 Aircrane” helicopter. Formed in 1971, the company has about 700 employees.

 

Erickson Air-Crane expects to have about 10.2 million shares outstanding after the offering.

 

Retail Properties of America plans to price 31.8 million shares of Class A common stock at $10 to $12 each on Wednesday evening. The IPO is expected to start trading Thursday morning on the New York Stock Exchange under the proposed symbol “RPAI.”

 

Based in Oak Brook, Illinois, Retail Properties is a real estate investment trust, or REIT. It believes it is one the largest owners and operators of shopping centers in the United States. The company’s retail operating portfolio consists of 259 properties located in 35 states; it includes power centers, community centers, neighborhood centers and lifestyle centers, as well as single-user retail properties. Formed in 2003, the company was known until recently as Inland Western Retail Real Estate Trust. It has about 265 employees.

 

Retail Properties expects to have about 80.4 million shares of Class A common stock outstanding after the offering.

 

For what it’s worth, the IPO experts look at this week as “BOR-ing.”

 

Stay tuned.