Rounding out this week’s calendar is a third deal in another sector: Starwood Property Trust (NYSE: STWD – proposed), a newly formed company that aims to go public as a real estate investment trust, or REIT.
Nashville Rx for IPOs
Cumberland Pharmaceuticals is a specialty pharmaceutical provider offering branded prescription products, such as Acetadote, an IV treatment for acetaminophen overdose; Kristalose, a prescription laxative, and Caldolor, the first injected form of ibuprofen. The company’s target markets are gastroenterologists and physicians in hospital acute care departments.
For the three months ending March 30, 2009, Cumberland reported net income attributable to common shareholders of $1.2 million on total revenues of $9.4 million, compared with net income attributable to common shareholders of $1.4 million on total revenues of $8.3 million for the same period a year ago.
Some Perspective
- On May 1, 2007, Cumberland filed for an IPO to raise $115 million. The Nasdaq Composite Index closed that day at 2,531.53. Over two years later, it closed on Friday, Aug. 7, 2009, at 2,000.25.
- On July 23, 2007, Cumberland filed an amendment to price 6.25 million shares at $14 to $16 each. The Nasdaq Composite Index closed that day at 2,690.58. The deal made it onto the IPO calendar for the week of Aug. 6, 2007, then to the week of Aug. 13, and then off the calendar.
- On July 17, 2009, Cumberland filed an amendment to price 5 million shares at $19 to $21 each. The Nasdaq Composite Index closed that day at 1,886.51. It closed Friday, Aug. 7, 2009, at 2000.25. The deal is now on the IPO calendar for the week of Aug. 10.
But that’s not all, folks!
- In 2000, Cumberland created access to a pipeline of early-stage product candidates by forming a subsidiary, Cumberland Emerging Technologies (CET). It was to assists universities and other research organizations to help bring biomedical projects from the laboratory to the marketplace.
- Cumberland Pharmaceuticals owns about 85 percent of CET. The remaining interest is owned by Vanderbilt University and the Tennessee Technology Development Corporation.
- Cumberland was formed in 1999. It has about 59 employees.
Cumberland plans to price 5 million shares at $19 to $21 each to raise $100 million. All 5 million shares are being offered by the company.
Underwriters: UBS Investment Bank, Jefferies and Wachovia Securities are the joint-lead managers. Acting as co-manager is Morgan Joseph
The IPO is expected to be priced Monday evening, Aug. 10, and to start trading on Tuesday morning, Aug. 11, 2009.
The Industry:
On Friday, Aug. 7, 2009, the Dow Jones U.S. Pharmaceuticals Index (DJUSPR) closed at 220.12, UP 0.25 percent from 219.87 on Dec. 31, 2008.
Emdeon is a provider of revenue and payment cycle- management solutions, connecting payers, providers and patients in the U.S. healthcare system.
For the six months ending June 30, 2009, Emdeon reported net income of $21.4 million on revenues of $444.4 million, compared with net income of $15.9 million on revenues of $422.6 million for the same period a year ago.
Some Numbers to Note
- On Sept. 12, 2008, Emdeon filed for an IPO to raise $460 million. The Nasdaq Composite Index closed that day at 2,261.27. It closed on Friday, Aug. 7, 2009, at 2,000.25.
- On July 27, 2009, Emdeon filed an amendment to price 21.45 million shares at $13.50 to $15.50 each. The Nasdaq Composite Index closed that day at 1,967.96. About 10 days later, on Friday, Aug. 7, it closed at 2,000.25. The deal is making its initial appearance on the IPO calendar.
There’s more to the story.
- Emdeon’s predecessors have been in the healthcare information solutions business for about 25 years. Before November 2006, Emdeon’s business was owned by HLTH Corporation. Emdeon conducts its business through EBS Master and its subsidiaries.
- EBS Master was formed by HLTH to act as a holding company for the group of HLTH subsidiaries that comprised its Emdeon Business Services segment.
- Emdeon was formed in 2008. It has about 2,200 employees.
Emdeon plans to price 21.45 million shares at $13.50 to $15.50 each to raise $211 million. The company plans to offer 10.725 million shares and selling shareholders plan to offer 10.725 million shares.
Among the selling shareholders are: General Atlantic Partners 83, L.P. offering about 7.1 million shares and GAP-W, LLC offering about 2.7 million shares.
Underwriters: Morgan Stanley is the lead manager. Acting as co-managers are Goldman Sachs, UBS Investment Bank, Barclays Capital, Citi, Credit Suisse, Jefferies, William Blair, Oppenheimer, Piper Jaffray and Wells Fargo Securities.
The IPO is expected to be priced Tuesday evening, Aug. 11, and to start trading on Wednesday morning, Aug. 12, 2009.
The Industry:
On Friday, Aug. 7, 2009, the Dow Jones U.S. Software & Computer Services Index (DJUSSV) closed at 590.06, UP 31.9 percent from 447.61 on Dec. 31, 2008.
Instead of Stardust, A Starwood REIT
Starwood Property Trust, based in Greenwich, Connecticut, was recently formed to originate, invest in, finance and manage commercial mortgage loans and other commercial real estate debt investments, commercial mortgage-backed securities, and other commercial real estate-related debt investments.
Read the fine print in the prospectus: This company plans to participate in the U.S. government’s PPIP, or Public-Private Investment Partnership, which was created to absorb some of the toxic assets after the credit markets’ meltdown last year.
Starwood plans to price 25 million shares at $20 each to raise $500 million.
Underwriters: BofA Merrill Lynch and Deutsche Bank Securities are the joint-lead managers.
The IPO is expected to be priced Tuesday evening, Aug. 11, and to start trading on Wednesday morning, Aug. 12, 2009.
The Industry:
On Friday, Aug. 7, 2009, the Dow Jones U.S. Real Estate Investment Trusts Index (DJUSRI) closed at 67.05, UP 9.3 percent from 61.37 on Dec. 31, 2008.
That about wraps up August before the IPO market’s late summer siesta. The IPO market traditionally closes down about two weeks ahead of the Labor Day holiday.