Finally, IPOs are back!
There’s only one deal on the calendar this week, but that’s nothing to fret about — it looks like we’ll see a spate of deals on the market at this time next week.
Let’s take a look at the deal at hand, as well as the deals we can expect to see next week:
OCI Resources is a limited partnership that owns a trona ore mining and soda ash production business based in the Green River Basin of Wyoming. The company has been in operation for more than 50 years, and based on recent reserve estimates, it should maintain current production levels for about 67 more years.
Trona ore and soda ash are key raw materials for such things as water softeners, flat glass, container glass, detergents, chemicals, paper and other consumer and industrial products. While there are chemical alternatives, they tend to be more expensive.
From 2010 to 2012, revenues increased from $363.1 million to $462.6 million, while net income went from $51.6 million to $101.8 million.
Now, onto next week’s deals:
Founded in 2006, Volaris is an ultra-low-cost airlne based in Mexico. The company now operates 235 daily flight for routes that connect 30 cities in Mexico and 10 cities in the United States.
To boost revenues, VLRS uses an “unbundling” strategy, choosing to charge add-on fees for things such as excess baggage, advance seat selection and extra legroom.
Growth has been strong, with revenues spiking 70% to $897.3 million from 2010 to 2012.
Volaris plans to issue 28.8 million shares on the NYSE under the ticker “VLRS” at a range of $12 to $14. Lead underwriters include Deutsche Bank (DB), Morgan Stanley (MS) and UBS Investment Bank (UBS).
Benefitfocus operates a cloud-based platform that allows the enrollment and management of employee benefits, such as healthcare, dental, life and disability. The system has a network of more than 900 benefit provider data exchange connections.
For the most part, BNFT focuses on employers with more than 1,000 employees, of which there are about 18,000 in the U.S. Currently, Benefitfocus serves 286 such clients.
Last year, revenues increased by nearly 19% to $68.8 million, but it also suffered a net loss of $14.7 million.
Benefitfocus intends to offer 4.5 million shares on the Nasdaq under the ticker “BNFT” at a range of $21.50 to $24.50. Lead underwriters include Goldman Sachs, Deutsche Bank and Jefferies.
Fate Therapeutics is a clinical-stage biotech company that is focused on adult stem cells to treat orphan diseases, such as hematologic malignancies, lysosomal storage disorders and muscular dystrophies. The company uses so-called “pharmacologic modalities” that are supposed to provide better targeting. Fate’s lead candidate, ProHema, is in Phase 2 clinical trials.
The company plans to issue 4 million shares on the Nasdaq under the ticker “FATE” at a range of $14 to $16. The lead underwriters include Cowen & Company and BMO Capital Markets.
Five Prime Therapeutics
Five Prime Therapeutics is another clinical stage operator, which is developing protein therapeutics. These are antibodies that essentially block disease processes, such as for cancer or inflammatory diseases.
So far, the company has created a library of more than 5,600 human extracellular proteins, and as a result, it has been able to snag over $220 million in collaboration agreements. Some of its pharma partners include GlaxoSmithKline (GSK) and UCB Pharma.
The founder and CEO of Five Prime, Lewis T. “Rusty” Williams, is a member of the National Academy of Sciences and was also the co-founder COR Therapeutics, which was sold to Millennium Pharmaceuticals for approximately $2 billion.
Five Prime plans to issue 4 million shares on the Nasdaq under the ticker “FRPX” at a range of $12 to $14. Lead underwriters include Jefferies, BMO Capital Markets and Wells Fargo Securities (WFC).
Tom Taulli runs the InvestorPlace blog IPO Playbook. He is also the author of High-Profit IPO Strategies, All About Commodities and All About Short Selling. Follow him on Twitter at @ttaulli. As of this writing, he did not hold a position in any of the aforementioned securities.