The IPO Buzz: Life in the IPO Fast Lane

Interestingly, the stock market was not the fuse that ignited the IPO calendar. The NASDAQ Composite Index closed on Friday, Oct. 26, 2012, at 2,987.95, DOWN 4.12 percent from Sept. 28’s close of 3,116.23. And the other major indexes finished the week underwater as well.

 

One thing that has been added to the equation has been the JOBS Act. Apparently it is working to facilitate companies going public. The numbers tell the story.

 

There are six IPOs on this week’s calendar. Five are scheduled to start trading in November. Wall Street sees three as “IPOs of interest.” Two are limited partnerships (LPs) and the other is a household name.

Delek Logistics Partners, LP  plans to price 8 million common units at $19 to $21 each. The IPO is expected to start trading on Friday morning, Nov. 2, on the New York Stock Exchange under the proposed symbol “DKL.” The joint-lead managers are BofA Merrill Lynch, Barclays, Goldman Sachs and Wells Fargo Securities. The co-managers are Deutsche Bank Securities, Raymond James and Simmons.

 

Based in Brentwood, Tennessee, Delek Logistics is a limited partnership recently formed by Delek US Holdings (DK) to own, operate, acquire and construct crude oil and refined products logistics and marketing assets. The company gathers, transports and stores crude oil and markets, distributes, transports and stores refined products in select regions of the Southeastern United States and West Texas for Delek and third parties.

 

Delek Logistics plans an annual cash distribution of $1.50 per unit to yield 7.5 percent, based on the mid-point of its proposed price range.

 

Southcross Energy Partners, L.P.  plans to price 9 million common units at $19 to $21 each. The IPO is expected to start trading on Wednesday morning, Oct. 31, on the New York Stock Exchange under the proposed symbol “SXE.” The joint-lead managers are Citigroup, Wells Fargo Securities, Barclays and J.P. Morgan. The co-managers are RBC Capital Markets, Raymond James, Baird, Stifel Nicolaus Weisel and SunTrust Robinson Humphrey.

 

Based in Dallas, Southcross is limited partnership that was formed to own, operate, develop and acquire midstream energy assets. The company provides natural gas gathering, processing, treating, compression and transportation services and natural gas liquids services to its producer customers.

 

Southcross Energy plans an annual cash distribution of $1.60 per unit to yield 8 percent, based on the mid-point of its proposed price range.

 

Restoration Hardware Holdings  plans to price about 5.2 million shares at $22 to $24 each. It is expected to start trading on Friday morning, Nov. 2, on the New York Stock Exchange under the proposed symbol “RH.” The joint-lead managers are BofA Merrill Lynch and Goldman Sachs. The co-managers are Baird, William Blair, Piper Jaffray and Stifel Nicolaus Weisel.

 

Based in Corte Madera, California, Restoration Hardware sells luxury brands of home furnishings in 73 retail stores and 12 outlet stores throughout the United States and Canada. In 2011, the company reported it distributed about 26.1 million catalogs, and its Website logged over 14.3 million unique visits. Restoration Hardware was formed in 1980. It has about 2,900 employees.

 

Restoration Hardware plans to sell about 4.8 million shares and selling shareholders plan to sell about 400,000 shares. The company expects to have about 37 million shares outstanding after the offering.

 

Restoration Hardware’s industrial sector, Dow Jones U.S Home Improvement Retailers Index (DJUSHI), has been an outperformer this year. On Friday, Oct. 26, the Index closed at 129.48, UP 36.6 percent from 94.48 on Dec. 30, 2011, versus a 12.3 percent gain by the S&P 500 Index.

 

That brings us to the following week and the 2012 presidential election. That story will dominate the news.

 

Stay tuned.