Just one blank check company priced an initial public offering this past week, as the IPO market resumed after the Memorial Day holiday. Proficient Alpha Acquisition (PAACU) raised $100 million as the SPAC begins looking for a financial services business in China.
The IPO Index slid -2.3% this week, while the VIX Volatility Index crept higher, finishing above 18.50. IPO activity generally starts to be impacted when the VIX stays in the 20-25 range.
A number of companies joined the IPO calendar, most notably fast-growing cybersecurity unicorn CrowdStrike (CRWD), which is targeting a $4.7 billion valuation in a deal scheduled for the week of June 10. Online fashion retailer Revolve Group (RVLV), which had been on file since last September, also launched its IPO.
Biotechs and genetics companies continued to stream into the IPO pipeline, with initial US filings from diagnostics platform Adaptive Biotechnologies (ADPT), CNS biotech Karuna Therapeutics (KRTX), chronic disease biotech Morphic Holding (MORF), and cancer biotech Genmab (GMAB). Online consignment marketplace The RealReal filed to raise $100 million and wireless networking infrastructure provider Cambium Networks (CMBM) also filed to raise $75 million.
The month ended with 26 IPOs, the most active May since 2013. There were 26 initial filings this past month, above the prior 10-year average for May (21). Thanks to Uber (UBER), year-to-date proceeds reached $24.5 billion, higher than any YTD period since 2012.
| 1 IPO During the Week of May 27th, 2019 | |||||
|---|---|---|---|---|---|
| Issuer Business |
Deal Size |
Market Cap at IPO |
Price vs. Midpoint |
First Day Return |
Return at 05/31 |
| Proficient Alpha Acq. (PAACU) | $100M | $126M | 0% | +0% | +1% |
| Blank check company targeting a financial services business in China. | |||||
Sign up for a free trial of our premium platform, IPO Pro. Follow us on Twitter (@IPOtweet) and register for our updates on the IPO market.
| 6 Filings During the Week of May 27th, 2019 | |||
|---|---|---|---|
| Issuer Business |
Deal Size |
Sector | Lead Underwriter |
| Karuna Therapeutics (KRTX) | $75M | Health Care | Goldman |
| Phase 2 biotech developing therapies for schizophrenia and other CNS disorders. | |||
| The RealReal (REAL) | $100M | Technology | Credit Suisse |
| Authenticated online luxury consignment store. | |||
| Adaptive Biotechnologies (ADPT) | $230M | Health Care | Goldman |
| Provides an immunosequencing platform for diagnosing and treating diseases. | |||
| Morphic Holding (MORF) | $86M | Health Care | Jefferies |
| Developing oral small-molecule integrin therapeutics for various chronic diseases. | |||
| Cambium Networks (CMBM) | $75M | Technology | JP Morgan |
| Provides cloud-based wireless broadband network infrastructure solutions. | |||
| Genmab (GMAB) | $500M | Health Care | BofA ML |
| Developing antibody therapies and technologies for cancer and other diseases. | |||
IPO Market Snapshot
The Renaissance IPO Indices are market cap weighted baskets of newly public companies. As of 5/30/19, the Renaissance IPO Index was up 29.5% year-to-date, while the S&P 500 had a gain of 12.2%. Renaissance Capital's IPO ETF (NYSE: IPO) tracks the index, and top ETF holdings include Elanco (ELAN) and Okta (OKTA). The Renaissance International IPO Index was up 9.1% year-to-date, while the ACWX was up 7.7%. Renaissance Capital’s International IPO ETF (NYSE: IPOS) tracks the index, and top ETF holdings include SoftBank and Xiaomi.
