The IPO Buzz: Final Show and A Unicorn Frenzy

This week could very well be the final show for the 2018 IPO market. Historical data show the IPO Calendar usually closes down by mid-December, and this year, that would fall on Friday, Dec. 14. Wall Street’s bankers are signaling that this year looks like it will follow this trend. After Friday, the IPO Calendar bears no footprints – much like the snow on an early Christmas morning.

Tencent Music Entertainment Group of China is among the seven names on this week’s IPO Calendar. Those seven deals are expected to raise $1.85 billion. There are three blank check offerings, two Chinese IPOs, one home manufacturer and a bank holding company that is a carryover from last week; more information on these in a minute.

Lightning from Uber and Lyft

There was some fascinating news reported by the financial media late last week. Two huge unicorns – Uber and Lyft – filed confidential papers to go public. A unicorn, of course, is a privately held start-up company with a market value of over $1 billion.

Yes, Virginia, Uber is finally planning to go public. Lyft, its much smaller U.S. rival, beat Uber to the punch by filing its confidential IPO papers ahead of Uber – triggering a splash of headlines on Thursday, Dec. 6th, a day before the Uber news broke.

Uber Technologies, based in San Francisco, operates in 785 cities worldwide. The company is best known for its ride-hailing service, Uber. Its other services include Uber Eats, a food-delivery service; Uber Freight, a service that matches carriers with shippers, and Uber Bike, a bike rental service. SharesPost, a website that tracks unicorns, lists Uber’s last round estimated valuation at about $70.3 billion.

Lyft, also based in San Francisco, operates in over 300 cities, primarily in the United States. A year ago, Lyft expanded to Canada. Lyft is best known for its ride service of the same name. The company offers other services – Lyft Scooter, a scooter rental service in select cities, and Lyft Business, a ride service that caters to business customers. Lyft is also involved in innovations that include a self-driving car. SharesPost lists Lyft’s last round estimated valuation at about $15.1 billion.

No filing terms are available, but both unicorns are now on track to go public. Lyft is expected to go public sometime in March or April 2019, according to The Wall Street Journal. Uber, which had been aiming to go public in the second quarter of 2019, is leaving its IPO options open for the first quarter, The WSJ reported late Sunday afternoon.

Seven on the IPO Marquee

Now let’s flip back to this week’s IPO show, which lists seven players in a run that could wrap up the year. Let’s take a look at those seven deals, organized by pricing and trading dates.

Monday evening for Tuesday morning

Mercantil Bank Holding, based in Coral Gables, Florida, is a bank holding company. The deal has been listed as an IPO, but its Class A and Class B shares are already traded on the Nasdaq Global Select Market under the trading symbols “AMTB” and “AMTBB.” On Friday, Dec. 7, 2018, Mercantil’s Class A stock closed at $14.05 on Nasdaq.

Tuesday evening for Wednesday morning

Tencent Music Entertainment Group (TME proposed), based in Shenzhen, is China’s largest online music entertainment platform, dubbed China’s Spotify by the financial press. In the prospectus, Tencent Music Entertainment said it operates “the top four music mobile apps in terms of mobile MAUs (monthly active users) in the third quarter of 2018.”

Wednesday evening for Thursday morning:

CF Finance Acquisition (CFFAU proposed), based in New York City, is a blank check company that intends to focus on potential target companies in the financial services or real estate services industries.

Thursday evening for Friday morning

360 Finance (QFIN proposed), based in Shanghai, is a leading digital consumer finance platform that caters to Chinese borrowers between the ages of 18 and 35, according to the prospectus. The company is the finance partner of the 360 Group. One of China’s largest Internet companies, which connects over 1 billion accumulated mobile devices.

Chardan Healthcare Acquisition (CHACU proposed), based in New York City, is a blank check company that intends to focus on emerging growth healthcare companies in healthcare niches including, but not limited to, biotechnology, medical technology and digital health.

Legacy Housing (LEGH proposed), based in Bedford, Texas, is a builder of manufactured homes and “tiny houses.” They are distributed through a network of independent retailers and company-owned stores and are sold directly to manufactured home communities. The company believes it is the fourth-largest producer of manufactured homes in the United States.

Week of Dec. 10th

Schultze Special Purpose Acquisition (SAMAU proposed), based in Rye Brook, New York, is a blank check company focusing on companies that have completed and emerged from a financial restructuring, which may have included a Chapter 11 bankruptcy court protection filing.

Next Week’s Blank Slate

For the week of Dec. 17th, the IPO Calendar has no deals. But that could change when the U.S. Securities and Exchange Commission’s filing window opens again for business on Monday morning.

Stay tuned.

Disclosure: Neither the author nor anyone else on the staff has a position in any stocks mentioned, nor do we trade or invest in IPOs. The author and staff do not issue advice, recommendations or opinion.