The IPO Buzz: The IPO Variety Show

One offering is being dubbed an initial public offering although its stock is traded on a foreign stock exchange. Another is a REIT. The third head to pop out of the IPO box is from China.

 

This week’s traffic includes a tech company whose stock has traded on the London Stock Exchange for years. Its headquarters just happens to be in California, also known as the Left Coast.    

 

Kofax Limited (KFX – proposed) is an Irvine, California-based provider of computer software and services that transform and simplify the business critical First Mile™ of real-time, information-intensive customer interactions. First Mile is a trademark of Kofax. The company was formed in 1985. It was acquired by Dicom Group in 1999. Its stock started trading on the London Stock Exchange’s Alternative Investment Market in 1996, and its listing transferred to the London Stock Exchange in December 1997. In January 2008, Dicom Group changed its name to Kofax. The company has about 1,248 employees.

 

Kofax plans to offer 2 million shares at $5.25 to $6.25 each to raise $11.5 million. The IPO will be priced on Thursday evening, Dec. 5, to start trading on Friday on The NASDAQ Global Select Market. The manager is Craig-Hallum Capital Group.

 

Worth Noting: From its prospectus: “Prior to this offering, the ordinary shares of Kofax plc have traded, and subsequent to this offering the common shares of Kofax Limited will trade, on the London Stock Exchange under the symbol “KFX.L.” The last reported sales price of Kofax plc on the London Stock Exchange on November 21, 2013, was 375.50 pence or $6.07 (based on the rate of exchange on that day).”

 

This year, the REIT IPO traffic shows a sharp increase over last year, according to the SEC filings. Consider the following:

·         In 2013, for the year to date, a total of 19 REIT IPOs were priced. They raised $4.96 billion. Their opening-day report card: Seven winners, eight losers, four unchanged and the average opening-day loss – yes, a loss – of 0.08 percent. Fast forward to Friday, Nov. 29, 2013: There has been a slight change in the numbers and not for the better. Their report card: eight winners, 11 losers and an average loss of 3.42 percent.

 

·         In 2012, a total of eight REIT IPOs were priced. They raised about $1.61 billion. Their opening-day report card: Three winners, four losers, one unchanged and the average opening-day loss of 0.71 percent. Fast forward to the present and their report card: Four winners, four losers and an average gain of 1.23 percent. Passing point of interest: The four winners were sharply above their initial offering prices and the four losers were sharply below their initial offering prices.

 

This brings us to CatchMark Timber Trust (CTT – proposed), a Norcross, Georgia-based REIT investing in timberland. The company, formerly known as Wells Timberland REIT, was founded in 2006 to give individual investors access to a renewable and sustainable real asset for their investment portfolios. CatchMark plans to price 10.5 million shares at $13 to $15 each on Monday, Dec. 9, to trade on Tuesday, Dec. 10, on the New York Stock Exchange. (More information next week.)

 

This year’s Chinese IPO report card rates an A or A-plus.

·         In 2013, a total of seven Chinese IPOs were priced. They raised $665.7 million. Their opening-day report card: Six winners, one loser and an average opening-day gain of 41.9 percent. Fast forward to the present and their report card: Six winners, one loser and an average gain of 56.4 percent.

 

·         In 2012, a total of three Chinese IPOs were priced. They raised $186 million. Their opening-day report card: One winner, two losers and an average opening-day loss of 1.91 percent. Fast forward to the present and their report card: Three winners, no losers and an average gain of 536.9 percent. Yes – an average gain of 536.9 percent. Passing point of interest: Vipshop Holdings (VIPS) was priced at $6 per share on March 22, 2012, and closed its opening day at $5.50. On Friday, Nov. 29, Vipshop ended at $83.11, UP 1,178.6 percent from its initial offering price. YY (YY) was priced at $10.50 per share on Nov. 21, 2012, closed its opening day at $11.31, and on Friday, Nov. 29, YY ended at $50.38, UP 379.81 percent from its initial offering price.

 

This brings us to Autohome (ATHM – proposed), a Beijing-based website that provides content focused on automobiles and related products. The content is generated by professionals and users displaying information for auto shoppers; the content includes advertising and dealer subscription services. On Friday, Nov. 29, the company posted its proposed offering terms to price 7.82 million American Depositary Shares at $12 to $14 each to raise $101.7 million. No pricing date was available at press time.

 

 

The year 2013 is winding down with only three weeks left for the IPO market. With the Dow Industrials and the S&P 500 running at record highs and the Nasdaq Composite at a 13-year high, all eyes will be focused on the SEC’s filing window to see what pops out and onto the IPO calendar.

 

Stay tuned.