Product testing and safety standards company UL Solutions Inc. (ULS proposed) filed to go public early today – Monday, Nov. 13, 2023 – without disclosing the terms for its IPO. Some on the Street estimate the IPO’s proceeds at $1 billion. The “UL” in the company’s name stands for Underwriters Laboratories, which began testing electrical products for fire risks during the 1894 World’s Fair in Chicago.
The company’s sole stockholder, ULSE Inc., also known as UL Standards & Engagement, is selling shares of its Class A common stock. The company will not be selling any shares in this IPO, according to the S-1 filing dated Nov. 13, 2023. UL Solutions will not receive any proceeds from the sale of the selling stockholder’s shares.
Goldman Sachs and J.P. Morgan are leading the joint book-runners’ team, which includes BofA Securities, Citigroup, Jefferies and UBS Investment Bank.
The S-1 filing stirs some interest in an IPO market that’s slowed to a snail’s pace amid the disappointing performance of most of this fall’s high-profile IPOs. High interest rates have also created headwinds for IPOs, along with the uncertainty created by war on two fronts – in the Middle East and Ukraine.
UL Solutions, based in the Chicago suburb of Northbrook, Illinois, traces its roots back to 1894.
“Since 1894, Underwriters Laboratories has been doing good things for humanity,” CEO Jenny Scanlon writes in the CEO’s letter, which is part of the prospectus. “It all started at the World’s Fair in Chicago, when our founder William Henry Merrill Jr., a graduate of MIT, was sent to assess fire risks from his job at Boston Board of Fire Underwriters. This work eventually led him to form Underwriters’ Electrical Bureau. The first testing lab followed shortly thereafter in the heart of Chicago, and the iconic Underwriters Laboratories was incorporated in 1901.
“Back then, the focus of our work was all about electricity,” the CEO’s letter says. “Today, the breadth and depth of our work is about that and so much more, spanning 35 industries, including energy and automation, engineered materials, building products, consumer technology and automotive and new mobility, just to name a few. We break things, we blow them up and we even light them on fire. All within the safe confines of our industry-leading laboratories and facilities, of course, to help people worldwide live in a safer, more secure and more sustainable world.
“We complement this work with a suite of software and advisory services that help our customers navigate constantly changing regulatory environments, among other imperatives.”
UL Solutions serves more than 80,000 customers worldwide and employs more than 14,000 people.
Safety is a profitable business, according to UL Solutions’ prospectus. UL Solutions earned net income of $296 million on revenue of $2.62 billion for the 12 months that ended Sept. 30, 2023.
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