The last week of September has 11 IPOs on the calendar – more IPOs than all of August 2015.
Out of 134 offerings so far in 2015, 61 have been health care companies. Next week, 7 out of the 11 IPOs on the calendar are health care. A large foodservice distributor and three microcap Chinese manufacturers round out the group.
The third largest US food service distributor with a 6% share, after leaders Sysco and US Foods, Performance Food Group (PFGC) was acquired in 2008 by Blackstone for $1.3 billion and is now growing faster than its larger rivals. Performance's momentum is driven by its Foodservice segment (59% of sales), serving independent restaurants and pizzerias, and its Vistar vending segment (16%), serving coffee and snack foods to offices, colleges and big box retailers. Performance plans to grow through further customer penetration in each segment, focusing on higher margin customers, growing proprietary brands and acquisitions. The company expects to raise $341 million.
Health care and biotech
LBO’d surgical center operator Surgery Partners (SGRY) has delivered strong same-facility growth since 2012 in the highly fragmented ambulatory surgical center (ASC) market. The company looks to raise $350 million, making it the largest deal next week. Backed by over $450 million in institutional and venture funding, NovoCure (NVCR) markets a wearable electric field device for treating glioblastoma brain cancer. The device, Optune, was approved by the FDA in 2011 and has been used to treat over 1,600 patients. The company hopes to raise $344 million to help fund its heavy losses.
Edge Therapeutics (EDGE) received orphan drug designation from the FDA in May 2015 for its sustained exposure therapies for bleeding around the brain. Backed by Sofinnova, Venrock and Janus, the company expects to raise $85 million. Mirna Therapeutics (MIRN) is developing microRNA replacement therapies for liver cancer and hopes to raise $65 million. RA Capital-backed Strongbridge Biopharma (SBBP) has raised $70 million in private funding for development of therapies for rare endocrine disorders. Next week it expects to raise another $76 million in its offering. Cerecor (CERC), which is developing adjunctive treatment for major depressive disorder, is looking to raise $27 million.
SynCardia Systems (TAHT) is developing and commercializing the SynCardia temporary Total Artificial Heart, or TAH-t, the only total artificial heart commercially available in the US, European Union and Canada. It hopes to raise $28 million. The company initiated a recall of a system used with the TAH-t after a patient’s primary unit alarmed and stopped pumping, causing him to lose consciousness. In mid-September, the FDA followed up with a Class I recall on the system.
Chinese Manufacturers:
Boxlight (BOXL), which originally set terms on July 28, hopes to raise $10 million. The company postponed its IPO in early August, then revised its terms downward from a $96 million proposed market cap to a $68 million proposed market cap. It sells display products, including standard projectors, interactive projectors and interactive LED flat panels, as well as audio systems, mounting devices and mobile stands.
Founder-led Sole Elite Group (SOLE) is a profitable designer and producer of foam and rubber shoe soles used to manufacture sports shoes. It expects to raise $33 million in its IPO. Fuling Global (FORK) is a manufacturer of disposable plastic products for US quick service restaurants (QSRs) that supplies four of the five largest fast food chains: Wendy’s, McDonald’s, Subway and Burger King. It plans to raise $30 million.
| Renaissance Capital's IPO Calendar - Week of 9/28/2015 | ||||
| Issuer Business |
Symbol Exchange |
Deal Size $mil |
Price Range Shares Filed |
Top 2 Bookrunners |
| Surgery Partners Nashville, TN |
SGRY Nasdaq |
$350 | $23.00 - $26.00 14,285,000 |
BofA Merrill Lynch Goldman Sachs |
| Owns or operates 99 surgical facilities across 28 states. | ||||
| NovoCure St Helier, Jersey |
NVCR Nasdaq |
$344 | $26.00 - $29.00 12,500,000 |
J.P. Morgan Deutsche Bank |
| Markets a wearable electric field device for treating glioblastoma brain cancer. | ||||
| Performance Food Group Richmond, VA |
PFGC NYSE |
$341 | $22.00 - $25.00 14,500,000 |
Credit Suisse Barclays |
| Third-largest US foodservice distributor LBO'd by Blackstone. | ||||
| Edge Therapeutics Berkeley Heights, NJ |
EDGE Nasdaq |
$85 | $14.00 - $16.00 5,666,667 |
Leerink Partners Credit Suisse |
| Developing a sustained-release therapy for ruptured brain aneurysms. | ||||
| Strongbridge Biopharma Trevose, PA |
SBBP Nasdaq |
$76 | $17.93 - $17.93 4,250,000 |
BofA Merrill Lynch Stifel |
| Late-stage biotech developing therapies for rare endocrine disorders. | ||||
| Mirna Therapeutics Austin, TX |
MIRN Nasdaq |
$65 | $13.00 - $15.00 4,650,000 |
Citi Leerink Partners |
| Developing microRNA replacement therapies for liver cancer. | ||||
| Sole Elite Group Jinjiang, China |
SOLE Nasdaq |
$33 | $10.00 - $12.00 3,000,000 |
Dawson James ViewTrade |
| Chinese athletic shoe sole manufacturer. | ||||
| Fuling Global Wenling, China |
FORK Nasdaq |
$30 | $5.00 - $7.00 5,000,000 |
Burnham Securities |
| Chinese producer of disposable plastic cutlery and other food service products. | ||||
| SynCardia Systems Tucson, AZ |
TAHT Nasdaq |
$28 | $10.00 - $12.00 2,500,000 |
Roth Capital |
| Developer and manufacturer of temporary implantable artificial hearts. | ||||
| Cerecor Baltimore, MD |
CERC Nasdaq |
$27 | $6.00 - $7.00 4,230,769 |
Maxim Group LLC |
| Developing a novel adjunct therapy for major depressive disorder. | ||||
| Boxlight Lawrenceville, GA |
BOXL Nasdaq |
$10 | $8.00 - $10.00 1,111,111 |
Aegis Capital Corp. |
| Manufactures interactive projectors and other classroom materials. | ||||
| Source: IPO ETF manager Renaissance Capital | ||||
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IPO pipeline update: The billion-dollar IPO club
In the pipeline, highly-anticipated tech IPO Pure Storage (PSTG), which hopes to raise $425 million, and Caribbean mobile service provider Digicel (DCEL), which expects to raise $1.8 billion, filed terms this week. Both are expected to price during the week of October 5. There are numerous IPOs in the pipeline that we estimate could raise over $1 billion, including notable names First Data (FDC), which could be the largest IPO of the year, Ferrari (FRRI), Albertsons (ABS) and Neiman Marcus (NMG). All have been on file since the beginning of August or earlier, yet none have announced an IPO date.
IPO Market Snapshot
Strong IPO volume in the fourth quarter will in part hinge on improved returns for recent IPOs. The Renaissance IPO Index has traded down 10.5% year-to-date, compared to -6.2% for the S&P 500. Renaissance Capital's IPO ETF (NYSE: IPO) tracks the index, and top ETF holdings include Alibaba (BABA), Hilton Worldwide (HLT) and Twitter (TWTR). In the past month, Alibaba and Twitter fell below their IPO prices for the first time. The Renaissance International IPO Index has traded down 4.6% year-to-date, compared to -9.1% for the ACWX. Renaissance Capital’s International IPO ETF (NYSE: IPOS) tracks the index, and top ETF Holdings include Recruit Holdings and Cheil Industries.
