Ingenious Buddy
Several large issuers debuted in the US this past week, and four IPOs joined the pipeline.
Sports equipment and apparel maker Amer Sports (AS) priced below the range to raise $1.3 billion at a $6.4 billion market cap. The Finland-based company’s portfolio includes major brands like Arc’teryx, Salomon, Wilson, and Louisville Slugger, and its products are sold in over 100 different countries, including in over 300 owned retail stores. Amer is highly profitable with strong revenue growth, but it is highly leveraged and has largely relied on China to deliver its recent growth. Amer Sports closed up 15%.
CNS disorder biotech Alto Neuroscience (ANRO) priced its upsized IPO at the top of the range to raise $129 million at a $456 million market cap. The company’s current pipeline consists of five clinical-stage assets targeting major depressive disorder (MDD) and schizophrenia. Its most advanced programs are being evaluated in ongoing Phase 2b trials, with topline data expected between the 2H24 and the 1H25. Alto Neuroscience finished the week up 29%.
Diabetes and obesity-focused Fractyl Health (GUTS) priced at the midpoint to raise $110 million at an $810 million market cap. Its lead candidate, the Revita DMR System, is an outpatient procedural therapy designed to durably modify duodenal dysfunction. Revita is approved for patients with inadequately controlled T2D in Europe, and the company expects to submit an IDE and comparable documents to the FDA for US approval in the 1H24. Fractyl is also developing a pancreatic gene therapy platform, and it plans to nominate its first candidate in 1Q24. Fractyl Health finished the week down 14%.
Cell therapy biotech FibroBiologics (FBLG) completed its direct listing on the Nasdaq, opening 275% above its reference price to begin trading at $30. Spun out of former parent FibroGenesis in 2021, FibroBiologics is focused on developing fibroblast-based therapies for patients suffering from chronic diseases with significant unmet medical needs. It completed a Phase 1 study in Mexico for refractory multiple sclerosis, and plans to submit an IND with the FDA for a Phase 2 trial. From its opening price, FibroBiologics finished down 50% amid volatile trading on low volume.
While not included below, global online betting and gaming operator Flutter Entertainment (FLUT) listed on the NYSE this past week, though it did not complete a firm commitment offering. The company’s portfolio includes a diverse array of brands spanning different countries, including FanDuel, Sky Betting & Gaming, and Sportsbet. In connection with its US listing, the company delisted from the Euronext Dublin, though it’s still listed on the LSE Main (FLTR). Flutter Entertainment traded up 6%.
| 4 IPOs During the Week of January 29th, 2024 | |||||
|---|---|---|---|---|---|
| Issuer Business | Deal Size | Market Cap at IPO | Price vs. Midpoint | First Day Return | Return at 02/02 |
| FibroBiologics (FBLG) | $0M | $281M | 0% | +264% | +88% |
| Phase 1 biotech developing fibroblast-based therapies for chronic diseases. | |||||
| Alto Neuroscience (ANRO) | $129M | $456M | 7% | +29% | +29% |
| Phase 2 biotech developing biomarker-focused therapies for depression and schizophrenia. | |||||
| Amer Sports (AS) | $1,365M | $6,412M | -24% | +3% | +15% |
| Sells apparel and sports gear under brands like Arc’teryx, Salomon, and Wilson. | |||||
| Fractyl Health (GUTS) | $110M | $810M | 0% | -14% | -14% |
| Developing a medical device and other therapies for type 2 diabetes and obesity. | |||||
Four IPOs submitted initial filings this past week. China-based EV charger and product provider XCharge (XCH) filed to raise $50 million. Electric bike, motorcycle, and scooter manufacturer and distributor Fly-E Group (FLYE) filed to raise $17 million. Hong Kong-based securities and asset management services provider Plutus Financial Group (PLUT) filed to raise $11 million at a $71 million market cap. Singapore-based civil engineering services provider SKK Holdings (SKK) filed to raise $11 million at a $70 million market cap.
| 4 Filings During the Week of January 29th, 2024 | |||
|---|---|---|---|
| Issuer Business | Deal Size | Sector | Lead Underwriter |
| Fly-E Group (FLYE) | $17M | Consumer Discretionary | Benchmark |
| Makes and sells electric bikes, motorcycles, and scooters. | |||
| XCharge (XCH) | $50M | Industrials | Deutsche Bank |
| Provides DC fast chargers and related EV technology out of China and Europe. | |||
| Plutus Financial Group (PLUT) | $11M | Financials | Pacific Century |
| Hong Kong-based provider of securities and asset management services. | |||
| SKK Holdings (SKK) | $11M | Industrials | Bancroft Capital |
| Provides civil engineering services for utility projects in Singapore. | |||
Six IPOs are currently scheduled for the week ahead, led by four $100+ million deals.
American Healthcare REIT (AHR) plans to raise $756 million at a $1.7 billion market cap. This REIT owns a portfolio of 298 healthcare properties, mostly in the US, and focuses primarily on medical offices, senior housing, and other healthcare-related facilities. American Healthcare REIT faces favorable tailwinds from an aging population and shift toward outpatient care, and it plans to pay a dividend. It will be highly leveraged post-IPO.
Mexico-based BBB Foods (TBBB) plans to raise $435 million at a $1.7 billion market cap. Operating under the name Tiendas 3B, the company is a leader in the grocery hard discount model in Mexico, with 2,288 stores at the end of 2023 and estimated white space for at least 12,000 additional stores. BBB Foods is leveraged, and high interest expense has resulted in a history of net losses.
Specialty insurer The Fortegra Group (TFG) plans to raise $297 million at a $1.5 billion market cap. The company is focused on underwriting complex and niche risks in underserved markets, operating within the admitted insurance, excess and surplus insurance, and capital light fee-based services markets. Fortegra has a financial strength rating of “A-” from A.M. Best.
Biotech Kyverna Therapeutics (KYTX) plans to raise $200 million at a $731 million market cap. Its lead candidate is an autologous CD19 CAR T-cell therapy, whose underlying CAR was licensed from the NIH. Kyverna plans to conduct two trials of this candidate in patients with lupus nephritis, and has received IND clearance for a Phase 1/2 study in systemic sclerosis. It has also received IND clearance for Phase 2 studies in myasthenia gravis and multiple sclerosis.
Holdover Perfect Moment (PMNT) plans to raise $8 million at a $101 million market cap. The company makes luxury ski outwear and accessories, swimwear, and activewear, which it sells both D2C and wholesale. It operates in a growing but highly seasonal industry.
Maritime tour operator Amphitrite Digital (AMDI) plans to raise $7 million at a $61 million market cap. The company provides in-destination tours, activities, and attractions in the continental US and US Virgin Islands, with an owned fleet of 26 luxury catamarans and power boats in the USVI and Panama City. Amphitrite Digital is small but growing.
| U.S. IPO Calendar | |||
|---|---|---|---|
| Issuer Business | Deal Size Market Cap | Price Range Shares Filed | Top Bookrunners |
| American Healthcare REIT (AHR) Irvine, CA | $756M$1,714M | $12 – $1556,000,000 |
BofA Morgan Stanley |
| Healthcare REIT with 298 properties in the US and UK. | |||
| Fortegra (TFG) Jacksonville, FL | $297M$1,451M | $15 – $1818,000,000 |
Goldman JP Morgan |
| Specialty insurer focused on niche business lines and fee-based services. | |||
| Kyverna Therapeutics (KYTX) Emeryville, CA | $200M$731M | $17 – $1911,120,000 |
JP Morgan Morgan Stanley |
| Phase 2-ready biotech developing cell therapies for autoimmune diseases. | |||
| Perfect Moment (PMNT) London, United Kingdom | $8M$101M | $6 – $71,232,000 |
ThinkEquity Laidlaw (UK) |
| Luxury lifestyle brand focused on ski apparel and other activewear. | |||
| Amphitrite Digital (AMDI) St. Thomas, U.S. Virgin Islands | $7M$61M | $3.50 – $4.501,750,000 | Kingswood Cap. Mkts. |
| Provides maritime tours and activities in the continental US and US Virgin Islands. | |||
| BBB Foods (TBBB) Mexico City, Mexico | $435M$1,739M | $14.50 – $16.5028,050,491 |
JP Morgan Morgan Stanley |
| Operates more than 2,200 discount grocery stores in Mexico. | |||
| Legato Merger III (LEGT.U)) New York, NY | $175M$225M | $1017,500,000 | BTIG |
| Blank check company targeting the infrastructure, E&C, industrial and renewables industries. | |||
Street research is expected for one company in the week ahead, and lock-up periods will be expiring for four companies. For access to Street research and lock-up expiration dates, sign up for a free trial of IPO Pro.
IPO Market Snapshot
The Renaissance IPO Indices are market cap weighted baskets of newly public companies. As of 2/1/2024, the Renaissance IPO Index was down 8.4% year-to-date, while the S&P 500 was up 3.0%. Renaissance Capital’s IPO ETF (IPO) tracks the index, and top ETF holdings include Kenvue (KVUE) and Coinbase Global (COIN). The Renaissance International IPO Index was down 9.6% year-to-date, while the ACWX was down 1.3%. Renaissance Capital’s International IPO ETF (IPOS) tracks the index, and top ETF holdings include Wise and Porsche.
Editor’s Note: The summary bullets for this article were chosen by Seeking Alpha editors.
