The big banks roared back from the long holiday weekend with the launch today of three big IPOs. Kodiak Gas Services, Inc. (KGS proposed), Savers Value Village, Inc. (SVV proposed) and Fidelis Insurance Holdings, Ltd. (FIHL proposed) set terms for their IPOs and launched the deals today (Tuesday, June 20, 2023) for pricing next week. The action took place shortly after sunrise today on Wall Street’s first day back to work after the three-day holiday weekend.
It’s perhaps no coincidence that this brisk IPO traffic follows the dazzling debut last week of CAVA Group, Inc. (CAVA), the Mediterranean fast-casual restaurant chain. CAVA ended its first day of trading with a 99 percent gain on Thursday and finished the week up 73 percent from its IPO price.
J.P. Morgan and Goldman Sachs are in either the lead left or the second lead-left position among the joint book-runners on two of the three deals. J.P. Morgan is running the joint book-running team on the third deal as well.
The trio of big IPOs launched today would raise a combined $925.5 million, if each is priced at the mid-point of its range. All are set for pricing next Wednesday night, June 28, 2023, to trade Thursday, June 29, on the New York Stock Exchange. That’s right. All three are NYSE listings.
There’s one more common thread among these three IPOs. Each company is profitable, according to the prospectus.
The U.S. stock market’s strength is also providing a steady wind to the IPO market’s sails. The three major U.S. stock indexes climbed to 2023 highs on Thursday (June 15, 2023), buoyed in part by the Fed’s decision to take a break from its rate increases. All three U.S. stock indexes slipped on Friday, although they ended the week with gains.
Let’s take a look at the three new names on the IPO Calendar.
Permian Basin Gas & Oil Play
Montgomery, Texas-based Kodiak Gas Services, Inc. (KGS proposed) says it is a market leader in the Permian Basin in providing large horsepower compression units under contract to blue-chip natural gas and oil companies. Its four largest customers are all members of the S&P 500, the prospectus says. Kodiak Gas Services’ hometown of Montgomery is located about 50 miles northwest of Houston.
Kodiak Gas Services is offering 16.0 million shares at $19.00 to $22.00 to raise $328.0 million. The company would have a market cap of $1.54 billion if priced at the $20.50 mid-point of its range.
Goldman Sachs, J.P. Morgan and Barclays are the lead joint book-runners. BofA Securities, Raymond James, RBC Capital Markets, Stifel, Truist Securities and TPH & Co. round out the joint book-running team.
Kodiak Gas Services earned net income of $65.98 million on revenue of $729.68 million for the 12 months that ended March 31, 2023, according to financial statements in the prospectus.
EQT AB, a Swedish public limited liability company, is the largest shareholder of Kodiak Gas Services, Inc. EQT AB’s stock is listed on the NASDAQ Stockholm exchange.
Silver and Gold in Secondhand Clothes
Selling secondhand clothes is a big business for Savers Value Village, Inc. (SVV proposed), the largest for-profit thrift store operator in the United States and Canada. The Bellevue, Washington-based company operated 317 stores in the United States, Canada and Australia, as of April 1, 2023. Savers Value Village also sells secondhand shoes and accessories, as well as secondhand bedding, bath items and housewares.
Savers Value Village earned net income of $62.59 million on revenue of $1.46 billion for the 12 months that ended April 1, 2023, according to the prospectus.
In its IPO, Savers Value Village is offering 18.75 million shares at $15.00 to $17.00 to raise $300 million. The company would have a market cap of $2.57 billion if the IPO is priced at the $16.00 mid-point of its range.
J.P. Morgan, Goldman Sachs, Jefferies and UBS Investment Bank are the joint book-runners
Bermuda and Bespoke Insurance
Bermuda-based Fidelis Insurance Holdings, Ltd. (FIHL proposed) provides bespoke insurance and specialty insurance as well as property reinsurance products. The company’s bespoke insurance focuses on highly tailored and specialized products, including policies covering credit risk, political risk, political violence and terrorism, limited cyber reinsurance, tax liabilities, titles, and transaction liabilities, according to the prospectus. Its specialty insurance includes aviation, energy, marine and natural catastrophe property insurance. Its reinsurance business is concentrated on residential property catastrophe reinsurance.
Fidelis Insurance Holdings’ IPO consists of 17.0 million shares at $16.00 to $19.00 to raise $297.5 million. The company will offer only 5.71 million shares. Selling shareholders will offer the remaining 11.29 million shares. Fidelis Insurance Holdings will not receive any proceeds from the sale of the selling shareholders’ stock.
J.P. Morgan, Barclays, Jefferies, Keefe, Bruyette & Woods (a Stifel company), BMO Capital Markets, Citibank and Credit Suisse are the joint book-runners.
If the IPO is priced at the $17.50 mid-point of its price range, Fidelis Insurance Holdings would have a market cap of $2.04 billion.
Fidelis Insurance Holdings earned net income of $62.3 million on revenue of $1.5 billion for the year ended Dec.31, 2022, the prospectus says.
(For more information about this company, please check the IPO Calendar and the individual IPO Profiles found on IPOScoop.com’s website.)
Note: Never trade on proposed symbols. They have been known to change and you might buy something on the OTC Bulletin Board.
To see what time the NASDAQ IPOs are expected to trade, please log in to: NASDAQTrader.com then scroll down to IPO Message.
Disclosure: Nobody on the IPOScoop.com staff has a position in any stocks mentioned above, nor do they trade or invest in IPOs. The IPOScoop.com staff does not issue advice, recommendations or opinions.
Disclaimer: A SCOOP Rating (Wall Street Consensus of Opening-day Premiums) is a general consensus taken, at press time, from Wall Street and investment professionals concerning how well an IPO might perform when it starts trading. The SCOOP Rating does not reflect the opinions of anyone associated with IPOScoop.com. The SCOOP ratings should not be taken as investment advice. The rating merely reflects the opinion of the professionals at the time of publication and is subject to last-minute changes due to market conditions, changes in a specific offering and other factors, such as changes in the proposed offering terms and the shifting of investor interest in the IPO. The information offered is taken from sources we believe to be reliable, but we cannot guarantee the accuracy.