All eyes are on the Dropbox (DBX proposed) IPO this week, but the parade of the IPO unicorns has started. One was priced last week and scored a moonshot opening-day gain. That was Zscaler (ZS) and the stock closed up 106.3 percent from its IPO price. As for Dropbox, people will have to wait until late Thursday afternoon, on March 22, for the final IPO price.
In addition, several Chinese IPOs filed offering terms for their pending IPOs late Friday afternoon, on March 16. Each has a market value of over $1 billion. The pricing dates will be posted Monday, March 19, when Wall Street gets back to work. (There will be more on these later in the story.)
Dropbox, based in San Francisco, provides a service that lets users bring photos, documents and videos in from anywhere and share them easily. Any file saved to Dropbox will automatically save to all computers, smartphones and tablets linked to the user’s account and to the Dropbox website. Dropbox also makes it easy to share files with others and collaborate in the cloud.
Note: Dropbox plans to offer about 26.82 million shares and insiders plan to offer about 9.18 million of the 36 million shares being offered. In addition, Salesforce Ventures plans to invest $100 million in a private placement in Dropbox at the IPO’s issue price.
Party of Three
This week’s IPO calendar has three names on it. There’s Dropbox, the headliner, aiming to raise $612 million at the mid-point of its $16-to-$18 price range. PolyPid (POLY proposed) and Sunlands Online Education Group (STG proposed) are the others. All three plan to raise about $850 million.
PolyPid, based in Petach Tikva, Israel, is a clinical-stage pharmaceutical company focused on developing products based on its polymer-lipid encapsulation matrix (PLEX) technology. The company’s leading product candidate is designed to treat surgical-site infections in bone and soft tissue. PolyPid intends to address unmet medical needs by pairing PLEX with active pharmaceutical ingredients, which are delivered locally at predetermined release rates and durations over periods ranging from days to several months. The company is also commercializing novel, locally administered therapies using its transformational PLEX technology.
Note: Certain insiders have indicated an interest in buying about $19.5 million of this $75 million IPO.
Sunlands Online Education Group, based in Beijing, offer various degree- and diploma-oriented post-secondary courses through its online platforms. In addition, the company offers online professional courses and educational content to help students attain professional skills and prepare for professional certification exams.
Now let’s revisit the billion-dollar IPOs, aka the unicorns.
The first moonshot of 2018 appeared on Friday – the day before St. Patrick’s Day. A moonshot, by definition, is an IPO that gains 100 percent or more on its first day of trading.
Zscaler, based in San Jose, California, is a cloud-based information security company. The company offered 12 million shares at $16 each, above the original 10 million shares at $10 to $12 each. The IPO opened Friday morning at $27.50 and closed at $33 – UP $17 or 106.3 percent from its IPO price.
Its stock market capitalization, based upon 117.3 million shares outstanding at $16 each, would equal about $1.88 billion.
In the wings are:
- Bilibili (BILI proposed) plans to price 42 million American Depositary Shares (ADS) at $10.50 to $12.50 each to raise $483 million. Its stock market capitalization – based upon 278.5 million ADS outstanding (each ADS equals 1 ordinary share) at $11.50 each – would equal about $3.2 billion.
- iQIYI (IQ proposed) plans to price 125 million ADS at $17 to $19 each to raise $2.25 billion. Its stock market capitalization – based upon 2,114.3 million ordinary Class A shares (each ADS equals 7 Class A ordinary shares) outstanding at $18 each – would equal about $5.4 billion.
- Onesmart International Education Group(ONE proposed) plans to price 16.3 million ADS at $11 to $13 each to raise $195.6 million. Its stock market capitalization – based upon 6,517.2 million ordinary shares (each ADS equals 40 Class A ordinary shares) outstanding at $12 each – would equal about $1.96 billion.
(For more information about these companies and others on the IPO calendar, please check the profiles found on IPOScoop.com’s website.)
For the week of March 26, 2018, the calendar has one Chinese IPO. Its market value is listed at $1.88 billion. Nevertheless, anything can happen when the SEC’s filing window opens again for business on Monday morning.
Disclosure: Neither the author nor anyone else on the IPOScoop.com staff has a position in any stocks mentioned, nor do we trade or invest in IPOs. The author and IPOScoop.com staff do not issue advice, recommendations or opinions.