While IPO activity typically takes a break in August, 2022 continues to throw curveballs. Four small deals priced this past week, joined by two SPACs. Two small IPOs and one SPAC submitted initial filings.
Malaysian e-payment app Treasure Global (TGL) priced at the low end to raise $8 million at a $65 million market cap. The company’s ZCITY App offers consumers and merchants instant rebates and affiliate cashback programs, along with an e-payment solution. Treasure Global soared 346% on its first day but deflated in the aftermarket, still finishing up 110%.
Electric boat developer Forza X1 (FRZA) raised $15 million at a $50 million market cap. Spun out of Twin Vee PowerCats (VEEE), the company aims to manufacture and sell affordable electric boats for recreational sport use. While it has only worked on prototypes to date, Forza X1 expects to start producing and selling their initial FX1 dual console and FX1 center console models in the 2Q23. Forza X1 finished up 50%.
California coffee roaster Reborn Coffee (REBN) upsized to raise $7 million at a $65 million market cap. The company serves specialty-roasted coffee at retail locations, kiosks, and cafes, as well as at its own company-owned stores. While Reborn is highly unprofitable and competes with significantly larger players, average unit volume at its retail locations increased 41% in 2021. Reborn Coffee finished down 4%.
Short-term rental provider CorpHousing Group (CHG) downsized and priced at the low end to raise $14 million at a $107 million market cap. Operating under its consumer brands, SoBeNY and LuxUrban, the company has 619 accommodation units in seven cities in the US. Profitable and fast-growing, it plans to launch international operations in 2022, starting with London or Paris. CorpHousing finished down 8%.
Two SPACs also priced during the week: Embrace Change Acquisition (EMCGU) raised $65 million to target tech and consumer, and growth-focused Hainan Manaslu Acquisition (HMACU) raised $60 million.
| 6 IPOs During the Week of August 8th, 2022 | |||||
|---|---|---|---|---|---|
| Issuer Business | Deal Size | Market Cap at IPO | Price vs. Midpoint | First Day Return | Return at 08/12 |
| Treasure Global (TGL) | $8M | $65M | -20% | +346% | +110% |
| Provides an e-payment app in Malaysia that offers instant rebates. | |||||
| Forza X1 (FRZA) | $15M | $50M | 0% | +50% | +50% |
| Fully electric boat developer being spun out of Twin Vee PowerCats. | |||||
| Embrace Change Acq. (EMCGU) | $65M | $85M | 0% | +0% | +0% |
| Blank check company targeting the technology, internet, and consumer sectors. | |||||
| Hainan Manaslu Acq. (HMACU) | $60M | $78M | 0% | +0% | +0% |
| Blank check company targeting businesses in high growth industries. | |||||
| Reborn Coffee (REBN) | $7M | $65M | 0% | -4% | -4% |
| Premium coffee roaster with nine cafe stores in California. | |||||
| CorpHousing Group (CHG) | $14M | $107M | -43% | -8% | -8% |
| Provides short-term rentals for travelers in major US cities. | |||||
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| 3 Filings During the Week of August 8th, 2022 | |||
|---|---|---|---|
| Issuer Business | Deal Size | Sector | Lead Underwriter |
| Lead Real Estate (LRE) | $27M | Real Estate | Network 1 |
| Luxury residential property developer in Japan. | |||
| Tower One (TO) | $14M | Communication Services | Maxim |
| Owns and operates mobile network towers in the Americas. | |||
| BCGF Acquisition (BCGFU) | $87M | SPAC | EF Hutton |
| Blank check company targeting the biotechnology industry. | |||
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IPO Market Snapshot
The Renaissance IPO Indices are market cap weighted baskets of newly public companies. As of 8/11/2022, the Renaissance IPO Index was down 37.9% year-to-date, while the S&P 500 was down 10.9%. Renaissance Capital's IPO ETF (NYSE: IPO) tracks the index, and top ETF holdings include Airbnb (ABNB) and Snowflake (SNOW). The Renaissance International IPO Index was down 29.6% year-to-date, while the ACWX was down 13.7%. Renaissance Capital’s International IPO ETF (NYSE: IPOS) tracks the index, and top ETF holdings include Kuaishou and EQT.
