Once the Memorial Day holiday was over, the IPO Calendar came back to life. June opens with four deals this week looking to raise about $840 million, with another two IPOs set for the second week of the month. On June 20th, the day before summer begins, there is the Slack Technologies (WORK proposed) offering of 118.43 million shares.
Let’s take a look at this coming blockbuster deal.
Slack Technologies, based in San Francisco, offers a cloud-based workplace messaging service that lets people communicate, collaborate and share documents in real time. Its customers include 65 companies in the Fortune 100. Slack had 645 paid customers, each providing $100,000 of annual recurring revenue (ARR), or 43 percent of its total revenue, for the three months ending on April 30, 2019, the prospectus says.
The Slack deal is a DPO – a Direct Public Offering. It is not an IPO. The company filed on Friday, May 31st, with the U.S. Securities and Exchange Commission for an offering of up to 118.43 million shares of Class A common stock by its shareholders, according to its latest S-1/A.
There is no investment bank underwriting the Slack offering – and there quite likely will not be a roadshow. Slack shareholders will offer their Class A shares for sale. A specialist on the New York Stock Exchange will set the price. Slack is expected to start trading on the NYSE on June 20th.
The most recent DPO is Spotify Technology SA (SPOT). The music-streaming company offered common stock in a DPO priced on April 2, 2018. Spotify’s stock started trading on the NYSE on April 3, 2018, at $165.90 – up nearly 26 percent from its initial reference price of $132. On its opening day, Spotify traded from an intraday low of $148.26 to a high of $169; it closed at $149.01 – up 12.9 percent from its initial reference price.
On Friday, May 31st, Spotify’s stock closed on the NYSE at $125.58 – trading from an intraday low of $103.29 to a high of $198.99 – on a day when stocks sold off after President Trump said he might impose escalating tariffs on Mexico.
A June to Remember
The SEC’s June window had not opened yet at press time. Before going further, let’s take a quick look at June’s IPO Calendar reaching back to 2001.
Looking back over the month of June running from 2001 through 2018, last year was one to remember. June 2018 turned out 36 IPOs, according to the SEC filings. June 2003 was one to forget. It produced only three IPOs. In contrast, the 18-year average for the month of June is 17.5 deals.
Blank Checks, China and a Fashion Fix
The curtain rises on June with four companies set to go public this week. Here’s the lineup, organized by pricing and trading dates:
Monday evening pricing to trade Tuesday morning:
GigCapital2 (GIX.U proposed), based in Palo Alto, California, is a blank check company that intends to focus on companies in the technology, media, and telecommunications industry.
Wednesday evening pricing to trade Thursday morning:
GSX Techedu (GSX proposed), based in Beijing, believes it is China’s third-largest online provider of after-school tutoring services for students in grades K-12.
Thursday evening pricing to trade Friday morning:
Haymaker Acquisition Corp. II (HYACU proposed), based in New York City, is a blank check company that intends to acquire and operate a business in the consumer or consumer-related products and services industries.
Revolve Group (RVLV proposed), based in Cerritos, California, is an online department store specializing in offering the hottest fashion brands favored by millennials. (Some sample merchandise: Levi’s Daisy Dukes, aka short shorts, or a House of Harlow 1960 cropped top with fluttery sleeves, a V. Chapman pink lace corset-topped mini-dress or a black Norma Kamali jumpsuit.)
(For more information about these companies and others on the IPO Calendar, please check the profiles found on IPOScoop.com’s website.)
June’s Second Week
For the week of June 10, 2019, the IPO Calendar has two deals scheduled. But anything can happen when the SEC’s filing window opens again for business on Monday morning.
Disclosure: Neither the author nor anyone else on the IPOScoop.com staff has a position in any stocks mentioned, nor do we trade or invest in IPOs. The author and IPOScoop.com staff do not issue advice, recommendations or opinions.