The IPO Buzz: June’s Bumper Crop of IPOs

The answer is the classic: “Due to market conditions.”

 

On June 1, 2012, the NASDAQ Composite Index closed at 2,747.48 – DOWN 11.9 percent from 3,119.70, its previous closing high set on April 2, 2012. Conclusion: The IPO market has shown time and again, it does not fly with the winds of a falling stock market in its face.

 

Fast forward to June 14, 2013: The NASDAQ Composite closed at 3,423.56 – UP 15.6 percent from 2,960.31, its previous closing low set on Dec. 28, 2012. Conclusion: The IPO market has shown time and again, it does fly with the winds of a soaring stock market under its wings.  

 

This brings us to this week and its calendar of six IPOs. Bankers are looking to raise about $3.9 billion. There are some contrasts coming from the biotech and biopharma companies. The key word is collaboration.

 

Two of this week’s bio-IPOs have collaboration agreements and the other two don’t. The “haves” are bluebird bio  (BLUE – proposed) and PTC Therapeutics (PTCT – proposed) and the “have-nots” are Aratana Therapeutics  (PETX – proposed) and Regado Biosciences  (RGDO – proposed).

 

Bluebird Bio plans to offer 5 million shares at $14 to $16 each on Tuesday evening. The IPO is expected to start trading Wednesday morning on the NASDAQ Global Market under the proposed symbol “BLUE.” The joint-lead managers are J.P. Morgan and BofA Merrill Lynch. The co-managers are Cowen, Canaccord Genuity and Wedbush PacGrow Life Sciences. Based in Cambridge, Massachusetts, bluebird bio is a clinical-stage biotechnology company focusing on developing innovative gene therapies for genetic disorders such as sickle cell anemia and Lorenzo’s Oil disease. Formed in 1992, bluebird bio about 50 employees.

 

Note: Bluebird reported collaboration agreements with Celgene Corporation and licensing agreements with Inserm-Transfert, Institut Pasteur, Stanford University, the Massachusetts Institute of Technology and Research Development Foundation.

PTC Therapeutics plans to offer 6.9 million shares at $13 to $16 each on Wednesday evening. The IPO is expected to start trading Thursday morning on the NASDAQ Global Market under the proposed symbol “PTCT.” The joint-lead managers are J.P. Morgan and Credit Suisse. The co-managers are Cowen and Wedbush PacGrow Life Sciences.

 

PTC Therapeutics, based in South Plainfield, New Jersey, is a biopharmaceutical company focusing on the discovery and development of orally administered proprietary small-molecule drugs that target post-transcriptional control processes. The company is working on potential treatments for genetic diseases such as cystic fibrosis and muscular dystrophy. PTC was formed in 1998. It has about 127 employees.

 

Note: PTC reported collaboration agreements with F. Hoffman-La Roche and Hoffman-La Roche and the Spinal Muscular Atrophy Foundation and a funding agreement with Wellcome Trust.

 

Epizyme (EPZM) was the last bio-IPO to go public with collaboration agreements. The company, based in Cambridge, Massachusetts, is a clinical stage biopharmaceutical company with collaboration agreements with Celgene, Roche Molecular Systems, Eisai and GlaxoSmithKline. On May 30, 2013, Epizyme priced its IPO at $15 per share. It closed on June 14, 2013, at $22.33 – UP 48.8 percent from its initial offering price.

 

Aratana Therapeutics plans to offer 4.25 million shares at $11 to $13 each on Monday evening. The IPO is expected to start trading Tuesday morning on the NASDAQ Global Market under the proposed symbol “PETX.” The joint-lead managers are Stifel and Lazard Capital Markets. The co-managers are William Blair, JMP Securities and Craig-Hallum Capital Group. 

Aratana, based in Kansas City, Kansas, is a development-stage biopharmaceutical company focusing on the licensing, development and commercialization of innovative prescription medicines for pets. Aratana was formed in 2012. It has about 16 employees.

 

Note: Aratana reported no collaborating partnerships in its recent prospectus.

 

Regado Biosciences plans to offer 5 million shares at $14 to $16 each on Tuesday evening. The IPO is expected to start trading Wednesday morning on the NASDAQ Global Market under the proposed symbol “RGDO.” The joint-lead managers are Cowen and BMO Capital Markets. The co-managers are Canaccord Genuity, Needham and Wedbush PacGrow Life Sciences.

 

Regado Biosciences, based in Basking Ridge, New Jersey, is focused on the discovery and development of novel first-in-class, actively controllable antithrombotic drug systems for acute and sub-acute cardiovascular indications. The company was formed in 2011. It has about 29 employees.

 

Note: Regado Biosciences reported no collaborating partnerships in its recent prospectus.

 

Alcobra Pharmaceuticals (ADHD) was the last bio-IPO to go public without collaboration agreements. The company, based in Tel Aviv, is an emerging biopharmaceutical company focusing on the development and commercialization of a proprietary drug to treat Attention-Deficit Hyperactivity Disorder, also known as ADHD. On May 21, 2013, Alcobra priced its IPO at $8 per share. It closed at $7.10 on June 14 – DOWN 11.3 percent from its initial offering price.

 

 

This week’s calendar rounds out with a giant Brazilian cement producer and a high-tech company delivering its services literally in the clouds.

 

Votorantim Cimentos S.A. plans to offer 200 million American Depositary Shares at US$15.59 to US$18.51 each to raise US$3.4 billion. The IPO is expected to be priced Wednesday evening and trade Thursday morning on the New York Stock Exchange under the proposed symbol “VEBM.” The joint-lead managers are Morgan Stanley, J.P. Morgan, Itaú BBA, Credit Suisse and BTG Pactual. The co-managers are HSBC, Goldman Sachs, Deutsche Bank, Bradesco BBI, BofA Merrill Lynch, Banco do Brasil and Banco Votorantim.

 

Votorantim is a São Paulo-based producer of cement, aggregates, concrete, lime and mortar supplied to large-scale construction projects such as office buildings, bridges and hydroelectric dams. The company and its subsidiaries operate 27 plants in Brazil and five in North America. Votorantim was formed in 1933. It has about 15,700 employees.

 

Note: The offering consists of 400 million units.

Foreign offerings can become complicated.

 

Gogo plans to offer 11 million shares at $15 to $17 each on Thursday evening. The IPO is expected to start trading Friday morning on the NASDAQ Global Market under the proposed symbol “GOGO.” The joint-lead managers are Morgan Stanley, J.P. Morgan and UBS Securities. The co-managers are Allen & Company, Evercore Group and William Blair.

 

Based in Itasca, Illinois, Gogo believes it is the world’s leading provider of in-flight connectivity and a pioneer in wireless in-cabin digital entertainment solutions. The company states in its recent prospectus: “As of April 30, 2013, we had 1,908 commercial aircraft online, which represented approximately 81% of Internet-enabled North American commercial aircraft at such date … ”

But Gogo company reported a loss of $14.5 million for the three-month period ending March 31, 2013. Formed in 1995, Gogo has about 660 employees.

 

This brings us to next week. At press time, there were seven IPOs on the calendar for the week of June 24. They expect to raise over $2.2 billion. That figure could easily expand. In today’s IPO market, the calendar can fill up quickly.

 

Stay tuned.