The IPO Buzz: A Big IPO Wish List

The December IPO calendar can be busy or not, depending upon market conditions. Reaching back to 1970, the busiest December was 1983; that calendar produced 99 IPOs, according to the U.S. Securities and Exchange Commission’s filings. The Nasdaq Composite Index gained 20.3 percent in 1983. In contrast, there have been four times since 1970 when no IPOs were priced in December. The last time that happened was in 2008, and the Nasdaq Composite Index lost 40.5 percent that year.

 

However, this December looks like it will go out with a bit of a pop – 10 IPOs on this week’s calendar, two for next week, and one deal has already been priced. Collectively, their dollar volume could be over $5 billon. December 2012 produced nine IPOs that raised $1.7 billion, and December 2011 produced 11 IPOs that raised $3.5 billion. This brings us to this week.

 

Five IPOs are drawing interest from the IPO handicappers: ARAMARK Holdings (ARMK – proposed), Autohome (ATHM – proposed), Hilton Worldwide Holdings (HLT – proposed), Nimble Storage (NMBL – proposed) and Valero Energy Partners LP (VLP – proposed). Let’s take a closer look at each.

 

ARAMARK Holdings is a Philadelphia-based global provider of food, facilities and uniform services to education, healthcare, business and industry, and to sports, leisure and corrections clients. ARAMARK was a publicly traded company from 1960 to 1984 and from 2001 to 2007. Founded in 1959, the company has about 272,000 employees.

 

Underwriters plan to offer 36.25 million shares of ARAMARK at $20 to $23 each to raise about $779.4 million. ARAMARK plans to sell 28 million shares and selling shareholders plan to sell 8.25 million shares in this offering. The IPO is expected to be priced on Wednesday evening and to trade on Thursday morning on the New York Stock Exchange under the proposed symbol of “ARMK.” The joint-lead managers are Goldman Sachs, J.P. Morgan, Credit Suisse and Morgan Stanley. The co-managers are Barclays, BofA Merrill Lynch, RBC Capital Markets, Wells Fargo Securities, Baird, PNC Capital Markets, Rabo Securities, Ramirez, Santander, SMBC Nikko and The Williams Capital Group.

 

(Note: Among the selling shareholders are: GS Capital Partners, CCPM Capital Partners, J.P. Morgan Partners, Thomas H. Lee Partners and Warburg Pincus LLC.)

 

Autohome is a Beijing-based online destination for automobile consumers in China. The company operates two websites, autohome.com.cn and che168.com. Autohome delivers comprehensive, independent and interactive content to automobile buyers and owners. The company believes it is ranked first among China’s automotive websites and automotive channels of Internet portals. Founded in 2008, the company has about 1,092 employees.

 

Underwriters plan to offer 7.8 million American Depositary Shares of Autohome at $12 to $14 each to raise $101.7 million. The IPO is expected to be priced on Tuesday evening and trade on Wednesday morning on the New York Stock Exchange under the proposed symbol of “ATHM.” The joint-lead managers are Deutsche Bank Securities and Goldman Sachs (Asia). The co-managers are Oppenheimer and Piper Jaffray.

 

Hilton Worldwide Holdings, based in McLean, Virginia, believes it is one of the largest and fastest-growing hospitality companies in the world. The company operates about 4,041 hotels, resorts and timeshare properties comprising 665,667 rooms in 90 countries and territories. The company has a portfolio of 10 world-class brands, including Hilton Hotels & Resorts brand, Waldorf Astoria Hotels & Resorts, Conrad Hotels & Resorts, DoubleTree by Hilton and Embassy Suites Hotels, Hilton Garden Inn, Hampton Inn, Homewood Suites by Hilton and Home2 Suites by Hilton, Hilton Grand Vacations, the Hilton Hawaiian Village and the London Hilton on Park Lane. Founded in 1919, the company has about 151,000 employees.

 

Underwriters plan to offer 112.8 million shares of Hilton Worldwide at $18 to $21 each to raise about $2.2 billion. The company plans to sell 64.1 million shares and selling shareholders plan to sell 48.7 million shares in this offering. The IPO is expected to be priced on Thursday evening and trade on Friday morning on the New York Stock Exchange under the proposed symbol of “HLT.” The joint-lead managers are Deutsche Bank Securities, Goldman Sachs, BofA Merrill Lynch and Morgan Stanley The co-managers are Blackstone Capital Markets, Macquarie Capital, Barclays, Mitsubishi UFJ Securities, Citigroup, Credit Suisse, HSBC, RBS, Baird, Credit Agricole, Nomura, Raymond James, RBC Capital Markets, UBS Investment Bank, CastleOak, Drexel Hamilton, Telsey and Ramirez.

 

(Note: The sole selling shareholder is Hilton Global Holdings. The Blackstone Group and its affiliates will not be selling any of its 750 million shares in the offering.)

 

Nimble Storage is a San Jose, California-based provider of information technology, hardware and software products for data storage. It offers an array of data storage that uses the iSCSI protocol and includes data-backup features. At the core of its innovative platform is its Cache-Accelerated Sequential Layout file system software (called CASL technology) and its cloud-based storage management and support service (called InfoSight). Founded in 2007, the company has about 528 employees.

 

Underwriters plan to offer 8 million shares of Nimble Storage at $16 to $18 each to raise $136 million. The IPO is expected to be priced on Thursday evening and trade on Friday morning on the New York Stock Exchange under the proposed symbol of “NMBL.” The joint-lead managers are Goldman Sachs and Morgan Stanley. The co-managers are Pacific Crest Securities, William Blair, Stifel, Oppenheimer and Needham.

 

Valero Energy Partners LP is a San Antonio-based fee-based, growth-oriented, traditional master limited partnership recently formed by Valero. The limited partnership is to own, operate, develop and acquire crude oil and refined petroleum products pipelines, terminals and other transportation and logistics assets. It will serve as Valero’s primary vehicle to expand the transportation and logistics assets supporting its business. Because the limited partnership does not take ownership of or receive any payments based on the value of the crude oil or refined petroleum products it handles and does not engage in the trading of any commodities, Valero Energy partners has no direct exposure to commodity price fluctuations.

 

Underwriters plan to offer 15 million common units representing the limited partnership interest of Valero Energy Partners at $19 to $21 each to raise $300 million. The IPO is expected to be priced on Tuesday evening and trade on Wednesday morning on the New York Stock Exchange under the proposed symbol of “VLP.” The joint-lead managers are J.P. Morgan and Barclays. The co-managers are Citigroup, RBC Capital Markets, Wells Fargo Securities, Mitsubishi UFJ Securities, SunTrust Robinson Humphrey, Credit Agricole CIB, Credit Suisse, Jefferies, Mizuho Securities, RBS and Scotiabank Howard Weil.

 

(Note: The limited partnership plans to make a minimum quarterly distribution of $0.2125 per unit for each whole quarter, or $0.85 per unit on an annualized basis to yield 4.25 percent at the mid-point of its price range.)

 

 

Next week is light, with just two deals. Yes, Virginia, the week of Dec. 16 is expected to wrap up the IPO year for 2013.

 

Stay tuned.