Just two small and delayed IPOs - a Chinese e-commerce company and a biotech - raised $105 million this week as management typically avoids investor roadshows before Easter.
The real action in the IPO market came from names like Party City (PRTY), Virtu Financial (VIRT) and Aduro Biotech (ADRO), which joined Etsy (ETSY) on next week's IPO calendar. Meanwhile, high-growth chicken and biscuits chain Bojangles (BOJA) submitted an initial filing. Cancer immunotherapy biotech Adaptimmune Therapeutics (ADAP) and muscular dystrophy biotech aTyr Pharma (LIFE) were also added to the pipeline.
WoWo (WOWO) went public as the year's fifth US tech IPO and the first from China when it raised $40 million, the minimum its shareholders mandated. Once known as the "Groupon of China," the online mall (55tuan.com) had been scheduled for over a month but finally achieved its NASDAQ listing and ended the week up 6% on low trading volume. With less than $1 million in cash and $40 million in accrued expenses and accounts payable as of September 30, 2014, the IPO provided much-needed liquidity.
Carbylan Therapeutics (CBYL) had originally been scheduled in January, but it postponed the offering. This week, the osteoarthritis knee pain biotech came back with a lower share price and a higher share count, dropping the proposed market cap by over 40%. By the time it priced, Carbylan raised an additional $5 million and insiders bought one fifth of the deal. Driven by Spark (ONCE), 2015 biotechs average a gain of 24% from their offer price, even as half have fallen negative.
ViewRay postpones
ViewRay (VRAY) became the seventh medical products/diagnostics company to postpone its IPO this year. The MRI systems maker was unable to find investors to commit $13 per share, even though it raised capital at $17 per share in January/February. The IPO market continues to serve as a valuation reality check for private companies.
| IPO pricings (week of April 6, 2015) | |||||
| Company (Ticker) | Business | Deal Size ($mm) | IPO Price vs. Midpoint | 1st-day Pop | Return as of 4/10 |
| WoWo (WOWO) |
Chinese online mall |
$40 | 0% | 3% | 6% |
| Carbylan Therapeutics (CBYL) | Biotech: Osteoarthritis pain | $65 | -62% | 11% | 6% |
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IPO market snapshot
The Renaissance IPO Index, a market cap weighted basket of newly public companies that is designed to represent the US IPO market, has traded up over 9% year-to-date, compared to 2% for the S&P 500. This suggests that the IPO market remains open to new issuance, which was also supported by the flurry of new filings. Renaissance Capital's IPO ETF (NYSE: IPO) tracks the index, and top ETF holdings include Twitter (TWTR), Alibaba (BABA), Hilton (HLT), Ally Financial (ALLY) and Voya Financial (VOYA). To find out if this is the best ETF for you, visit our IPO investing page.
