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IPO Outlook: 
60% of IPOs are Trading Down
Author: Yordanka Bahchevanska
123jump.com
Last Update: 5:09 PM EDT August 14 2006


Hard market conditions prompted by worries about inflation and interest-rate increases among other factors, caused two companies to withdraw or postpone scheduled IPOs in the first week of August. A hundred and twenty five companies have launched IPOs so far in 2006, and only 41% of them are currently trading above their offering price.

 
125 initial public offerings have been priced so far this year as of August 12, 2006:

- 51 IPOs are currently trading above initial offering price;
- and 74 are trading below the offering price;

Three IPOs were priced during the week of August 12th, 2006. There are two deals on deck for the next week hoping to raise nearly $454.6 million.

IPO PERFORMANCE

Evercore Partners Inc. (EVR: chart) priced nearly 4 million shares at $21, above the filing range of $18 to $20.

Boutique investment bank raised $82.95 million in the initial public offering, higher than expectations.

In addition, the underwriters have an option to buy 592,500 additional shares to cover over-allotments, which could increase the total value of the IPO to more than $582 million.

Lehman Brothers was the lead manager for the offering. Goldman Sachs and J.P. Morgan were joint lead managers. Keefe, Bruyette & Woods, Fox-Pitt, Kelton and E*TRADE FINANCIAL were acting as co-managers.

Evercore Partners is a leading investment banking boutique and investment firm. Evercore''s advisory business counsels its clients on mergers, acquisitions, divestitures, restructurings and other strategic transactions.

The shares closed the first day, Friday, at $24.85, up 18.3% from the offering price.

Aircastle Ltd. (AYR: chart) priced 9.1 million shares at $23, the high end of the filing range of $21 to $23, on Thuesday. The offering represents 18% stake in the company and raised $209 million.

The Hamilton, Bermuda-based company also granted the underwriters an option to buy up to 1.4 million shares to cover over-allotments.

The deal was managed by J.P. Morgan Securities, Bear Stearns, and Citigroup.

J.P. Morgan, Bear Stearns and Citigroup were acting as lead managers of this offering.

Aircastle Limited is an aviation company that acquires, owns and leases high-utility commercial jet aircraft to airlines throughout the world.

The company earned $11.2 million on revenue of $33.0 million in the first quarter of 2006 after losing $1.4 million on revenue of $2.2 million in the first quarter of 2005.

The stock closed the first day at $26.60, up 15.7%, and finished the week at $27.05, up 17.6% from the offering price.

Semiconductor company Qimonda AG (QI: chart), a spin off from chip maker Infineon, priced 42 million American depositary shares at $13. The deal was worth $628 million.

The Munich, Germany – based priced well below the filing range of $16 to $18 and the offering size was reduced from 63 million American depositary shares.

The deal was managed by Credit Suisse, Citigroup, and J.P. Morgan Securities.

The IPO leaves Infineon with a stake of 86% to 88% in Qimonda, more than the 79% it had planned on.

Infineon, which is prevented by a lock-up clause from selling more Qimonda shares for 190 days, reiterated its intention to reduce its holding to a minority.
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