The initial public offering (IPO) market is showing signs of life for this week with six deals on tap, four of which are expected to raise over $100 million. Last week saw no pricings due to the Juneteenth Holiday Monday, but the market is back on track with five companies filing to go public alongside a special-purpose acquisition corporation (SPAC).
One of the notable companies on this week’s slate is Gen Restaurant Group, a Korean BBQ chain that delayed its deal from last week to this one. With its IPO, the company aims to follow in the success of Cava Group Inc. CAVA, a Mediterranean-style restaurant chain that went public in mid-June at $22 a share and was trading at $42.95, a more than 99% increase on its first day of trading. This was the biggest gain for a U.S. company since 2021 and the largest for a restaurant IPO since Shake Shack in 2015, according to Renaissance Capital, a provider of IPO exchange-traded funds and institutional research.
There are several bullish signals for the IPO market, starting with the IPO ETF’s roughly 26% year-to-date gain, which outpaces the 13% increase in the S&P 500 SPX. For restaurant deals, it’s clearly a green light, noted Renaissance co-Founder and Chief Executive Bill Smith in recent commentary.
Bull Market Predicted After Fed Keeps Rates Unchanged
Investors are focused on a possible bull market following the Federal Reserve’s decision to maintain interest rates during its last meeting. This can attract interest from retail investors and institutional funds that are eager for IPOs.
Despite the pandemic’s effects on businesses, according to Renaissance, there have been a significant number of deals. Since forty-six US transactions have occurred this year, up 21% from last year’s period when the market was entirely frozen. In turn, companies were able to secure a total of $7.6 billion, a 91% increase compared with the previous year.
Activity remains strong as 89 companies filed for IPOs, up 16% compared with the same period last year.
The most prominent offering of this week comes from Vesta Real Estate (VTMX) located in Mexico, specializing in industrial buildings. Vesta applied to list on the NYSE using the ticker symbol “VTMX” with plans to earn about $401 million, valued at approximately $2.6 billion, with proceeds earmarked for land or property acquisition and infrastructure investments.
Kodiak Gas Services (KGS) is expected to be the second-largest deal coming this week. The company aims to raise up to $353 million and has assets in Permian Basin and Eagle Ford Shale. Kodiak Gas Services will trade on NYSE under the ticker symbol “KGS.”
Thrift Store Chain Savers Blue Village Aims to Raise $300 Million
Savers Blue Village (SVV), the largest for-profit thrift store chain in North America, is looking to raise $300 million at a $2.8 billion valuation, as reported by Renaissance. The chain has 317 stores operating under various names and plans to list on the NYSE with the ticker “SVV.”
Bermuda-based Reinsurance Company Fidelis Insurance Holdings Aims to Raise $298 Million
Fidelis Insurance Holdings (FIHL), a reinsurance company based in Bermuda, aims to raise $298 million with a valuation of $2.1 billion. The company has applied to list on the NYSE with the ticker “FIHL.”
Gen Restaurant Plans to Raise $33 Million
Gen Restaurant (GENK) plans to raise $33 million with a $352 million valuation. The company has 34 locations, mostly in California, and is profitable. It has applied for listing on Nasdaq with the ticker “GENK.”
Alliance Entertainment Holding Applies for Nasdaq Listing
Alliance Entertainment Holding (AENT), an over-the-counter listed wholesaler and direct-to-consumer provider for the entertainment industry, aims to list on Nasdaq under the ticker “AENT.” According to its filing documents, the company serves as the gateway between brands and retailers.
