The IPO Buzz: September’s IPO Surprise

For the week, the Dow Jones industrial average lost 6.4 percent, while the Standard & Poor’s 500 dropped 6.5 percent and the Nasdaq Composite Index lost 5.3 percent.
In contrast, the sun was shining in the Land of IPOs.
The IPO calendar remained clean and green, which is natural when stocks sell off. But the U.S. Securities and Exchange Commission (SEC) filing window was bustling.
The SEC reported four companies filed plans to go public. There’s more to the story than that. The filings raised September 2011’s total to 18 new filings looking to raise $3.2 billion. Here’s what is surprising: That volume is more than in September 2010 (12 new filings looking to raise $1.9 billion) and in 2009 (9 new filings looking to raise $2.9 billion).   
In addition, nearly 10 companies posted amended filings (S-1/A) updating financials and announcing other significant information. There were a couple of names that stood out from the rest: Groupon and Zynga.
Regrouping at Groupon  
The Groupon filing had a few stories to tell.
The first notable change was on the front page of its preliminary prospectus. J.P. Morgan was no longer listed as a joint-lead manager. The investment banker will now be one of the co-lead managers. And Citadel Securities had been dropped as a co-manager. No explanation was given.
Then on page 33 was a reprint of the famous internal memo that CEO Andrew Mason sent to his employees. It had been leaked to the financial press. The memo defended Groupon from remarks made by the press. Writing and sending out such a memo while the company is in registration is a “no-no” under the Securities Act of 1933.
And skipping forward to page 43, one saw Groupon’s financials had been “restated” and the terminology for “revenues” changed.
In its original (S-1) filing, what the company reported for gross profits (revenues less cost of revenues) became revenues in its latest amendment (S-1/A) filing. And the comparable figures were different as well.
The Groupon filing did not announce proposed pricing terms, which means there is no offering date on the horizon.
New Numbers from Zynga
Zynga, the San Francisco-based social game developer, filed an amended S-1/A. It was much less interesting than Groupon’s.
The company posted its six-month results for the period ended June 30, 2011, with a comparison for the same period a year ago. Its net income was slightly lower.
Let’s skip ahead to page 59 for a quarter-to-quarter comparison. It stated:
For the three months ending June 30, 2011, Zynga reported net income of $1.39 million on revenues of $279.1 million, compared with net income of $13.95 million on revenues of $130.1 million for the same period a year ago.
The Zynga filing did not announce proposed pricing terms, which means there is no offering date on the horizon.
Stay tuned. 
Disclosure: Neither the author nor anyone else on the staff has a position in any stocks mentioned, nor do they trade or invest in IPOs. The author and staff do not issue advice, recommendations or opinions.