Laser Photonics Corp. (LASE) priced its IPO – 3 million shares at $5.00 – on Thursday night (Sept. 29, 2022) to break the ice of the late September freeze. This tiny IPO is the first one approved by the NASDAQ after word went out on the Street last week that the exchange had put into effect a moratorium on small-cap IPOs. Laser Photonics’ stock opened flat at $5.00 at 10:23 a.m. EDT today (Friday, Sept. 30, 2022) on the NASDAQ and then headed lower. Laser Photonics’ stock closed at $2.92, down 41.6 percent from its IPO price to end its first day of trading as a broken deal. (Editor’s Note: This column was updated Friday with IPO trading news.)
Two SPAC IPOs – a NASDAQ listing and an NYSE-American deal – also got done on Thursday night (Sept. 29, 2022). Those pricings pushed the SPAC deal count to 78 so far this year.
Today marks the final trading day of September and the third quarter of 2022 – both set to go down as the worst for the IPO market since 2009. Only four traditional IPOs made it out the door in September 2022 – ranging from Corebridge Financial, Inc. (CRBG), the year’s biggest IPO at $1.7 billion, to Yoshiharu Global Co. (YOSH), one of the year’s smallest IPOs, at $11.8 million. In addition to those four deals, September’s tally included a handful of unit IPOs and uplistings as well as four SPACs.
U.S. stock futures were pointing to a positive open – ahead of August personal spending data at 8:30 a.m. EDT – only to turn lower after the data came out. It’s been a rough week. The Dow Jones industrial average slid into a bear market on Monday for the first time since the pandemic plunge in March 2020. A monstrous relief rally on Wednesday gave weary traders some respite – only to be followed by Thursday’s sell-off, which drove the S&P 500 down to its lowest close since November 2020, according to The Wall Street Journal.
At Friday’s closing bell, the Dow was down 500.10 points, or 1.75 percent, at 28,725.51, while the NASDAQ was down 161.89 points, or 1.5 percent, at 10,575.62, and the S&P 500 was down 54.85 points, or 1.51 percent, at 3,585.62. The waves of red ink swept the three major U.S. stock indexes further into the losing column for the week, the month and the quarter.
“The declines gave the S&P 500, Dow Jones Industrial Average and Nasdaq Composite their worst first nine months of a calendar year since 2002, according to Dow Jones Market Data,” The Wall Street Journal reported.
For the week, IPO bankers raised $125 million from three deals. Let’s take a look.
September’s Final IPO
Laser Photonics Corp. (LASE) goes into the IPO books as the last traditional IPO to make its debut in September 2022. It’s also the first modest IPO to get NASDAQ approval since the news broke last week that NASDAQ’s regulatory team had placed a moratorium on new issues for small-cap companies – those with market valuations of $300 million or less. The NASDAQ did not make an announcement. But Bloomberg reported that NASDAQ was giving extra scrutiny to small-cap IPOs and their bankers, particularly with respect to allocations, after the wild pops and swings of some tiny deals this summer.
“There’s a lot of interest in LASE because it’s the first one to break the ice since last week,” a seasoned IPO trader said.
The pricing of Laser Photonics was in line with the terms in the prospectus: 3.0 million shares at $5.00 each to raise $15.0 million. (Note: This is a stock-only IPO. The warrants were removed in late August, SEC filings show.)
Alexander Capital was the sole book-runner of the Laser Photonics IPO.
Laser Photonics Corp., based in Orlando, Florida, says it is pioneering a new generation of laser blasting technologies focused on disrupting the sandblasting and abrasives blasting markets. The company says its laser blasting solutions are used for everything “from product fabrication to maintenance and repair, as well as aftermarket operations” in a wide spectrum of industries, including automotive, aerospace, health care, consumer products, shipbuilding, heavy industry, machine manufacturing, nuclear maintenance and de-commissioning, and surface coating.
“We offer a full portfolio of integrated laser blasting solutions for corrosion control, rust removal, de-coating, pre-welding and post-welding, laser cleaning and surface conditioning,” the prospectus says.
Laser Photonics reported net income of $0.84 million on revenue of $4.42 million for the last 12 months.
A Tale of Two SPAC IPOs
September is wrapping up with two SPAC IPOs – one cut by 20 percent and the other priced in line with its terms.
dMY Squared Technology Group (DMYY.U) downsized its IPO to 6.0 million units, down from 7.5 million units, at $10.00 each at pricing on Thursday night (Sept. 29, 2022). The deal raised $60.0 million. The units started trading today (Friday, Sept. 30, 2022) on the NYSE-American exchange. Each unit consists of one share of common stock and one-half of one redeemable warrant. Shares of dMY Squared Technology Group opened lower today on the NYSE-American exchange, slipping to $9.90 at the first trade and then retracing a bit to trade at $9.95 at 10:43 a.m. EDT. dMY Squared Technology Group’s stock ended flat on iits first day of trading, closing at $10.00 on the NYSE-American exchange.
Needham & Co. was the sole book-runner of dMY Squared Technology Group’s SPAC IPO.
Las Vegas-based dMY Squared Technology Group will search for targets within the professional services industry, including companies that provide accounting, legal, financial, advisory or other services to public companies or private companies that are in the process of becoming public companies with enterprise values in the range of $500 million to $2 billion.
In contrast, Qomolangma Acquisition Corp. (QOMOU) priced its SPAC IPO on Thursday night (Sept. 29, 2022) in line with the terms in its prospectus: 5.0 million units at $10.00 each to raise $50.0 million. The units began trading today (Friday, Sept. 30, 2022) at 11:37 a.m. EDT on the NASDAQ – with the stock opening at $9.98, down 2 cents from the unit’s IPO price. Qomolangma’s stock ended Friday’s session at $9.99, down a penny from its IPO price.
For the record: Each Qomolangma unit consists of one share of common stock, one right to receive one-tenth (1/10) of a share of common stock upon the consummation of an initial business combination, and one redeemable warrant. Each warrant entitles the holder to buy one share of common stock.
Asia is in focus at Qomolangma Acquisition Corp., a New York-based SPAC that intends to search for middle-market businesses with individual enterprise values between $300 million and $500 million. Its search for target companies will focus on business segments with strategic significance to the Asian markets. Such sectors include the Internet and high tech, financial technology (FinTech), clean energy, agriculture machinery, health care, consumer and retail, energy and resources, food processing, manufacturing and education.
Meanwhile, traffic slowed almost to a standstill this week at the SEC’s filings window. The week began with some Wall Street denizens away from the office to observe Rosh Hashanah, the Jewish New Year. That might account for some of the slow traffic, but the NASDAQ moratorium and the bear market would weigh more heavily in this sphere.
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.
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