AndreyPopov
Two IPOs priced this past week, each raising more than $200 million, while one small issuer delayed (AZTR). They were joined by one SPAC. Six IPOs and one SPAC submitted initial filings.
Leading the week, Cummins spin-off Atmus Filtration (ATMU) priced at the midpoint to raise $275 million at a $1.6 billion market cap. Primarily operating under the Fleetguard brand, the company makes various filtration products for engines and other industrial uses, which are sold in 150 countries. Atmus is profitable, and its OEM customers support recurring revenue from higher-margin aftermarket products, but its three largest customers accounted for about half of 2022 revenue. The company finished up 11%.
Filing and pricing in the same week, Canada-listed ATS Corporation (ATS, ATS:CA) raised $236 million at a $4.0 billion market cap. The company designs, manufactures, assembles, and services automation systems, primarily serving the life sciences, transportation, and food & beverage industries. ATS is profitable and growing with good revenue visibility. It is leveraged post-IPO, despite using the proceeds to pay down debt. ATS finished up 5%.
The sole SPAC to price this past week, Kingstown Capital’s Inflection Point Acquisition Corp II (IPXXU) upsized to raise $220 million to target businesses in disruptive growth sectors.
In addition to ATS, five other IPOs submitted initial filings this past week. Taiwan-based cancer diagnostics developer Advanced Biomed (ADVB) filed to raise $150 million; Univest is the sole bookrunner on the deal. US-based Korean BBQ restaurant chain GEN Restaurant Group (GENK) filed to raise $25 million. Hong Kong-based public relations firm Intelligent Group (INTJ) filed to raise $23 million at a $66 million market cap. Maison Solutions (MSS), a US grocer specializing in Asian merchandise, filed to raise $12 million at a $75 million market cap. Toy maker SRM Entertainment (SRM) filed to raise $9 million at a $50 million market cap.
The sole SPAC to file this past week was Aimei Health Technology (AFJKU), which filed to raise $50 million to target small-cap healthcare.
| 6 Filings During the Week of May 22nd, 2023 | |||
|---|---|---|---|
| IssuerBusiness | DealSize | Sector | LeadUnderwriter |
| Aimei Health Technology (AFJKU) | $50M | SPAC | Spartan Capital |
| Blank check company targeting small-cap healthcare businesses. | |||
| GEN Restaurant Group (GENK) | $25M | Consumer Discretionary | |
| Korean BBQ restaurant chain with 32 locations in the US. | |||
| SRM Entertainment (SRM) | $9M | Consumer Discretionary | EF Hutton |
| Makes toys and souvenirs for theme parks and entertainment venues. | |||
| Intelligent Group (INTJ) | $23M | Industrials | Univest Sec. |
| Provides financial public relations consulting in Hong Kong. | |||
| Advanced Biomed (ADVB) | $150M | Health Care | Univest Sec. |
| Taiwanese developer of microfluidic testing equipment for early cancer screening. | |||
| Maison Solutions (MSS) | $12M | Consumer Staples | Joseph Stone |
| US specialty grocer offering traditional Asian food and merchandise. | |||
Just one small holdover is scheduled to price in the short holiday week ahead.
Azitra (AZTR) plans to raise $12 million at a $70 million market cap. The biotech’s pipeline is led by a genetically modified strain of bacteria targeting orphan disease Netherton syndrome. Azitra’s lead candidate is expected to enter a Phase 1b trial in the 1H23, and the company has a joint development agreement with Bayer (OTCPK:BAYZF, OTCPK:BAYRY) to develop bacterial microbes for consumer and cosmetic products.
While the post-Memorial Day IPO calendar looks quiet, movement in the pipeline has set the stage for a potentially active June. Several sizable deals have filed or updated in the past month, including restaurant chains CAVA Group (CAVA) and Fogo Hospitality (FOGO), energy plays MN8 Energy (MNX) and Kodiak Gas Services (KGS), thrift store chain Savers Value Village (SVV), and Bermuda-based reinsurer Fidelis Insurance (FIHL).
| U.S. IPO Calendar | |||
|---|---|---|---|
| IssuerBusiness | Deal SizeMarket Cap | Price RangeShares Filed | TopBookrunners |
| Azitra (AZTR) Branford, CT | $12M$70M | $4.50 – $5.502,400,000 | ThinkEquity |
| Phase 1-ready dermatology biotech developing engineered bacterial therapies. | |||
Street research is expected for two companies in the week ahead.
IPO Market Snapshot
The Renaissance IPO Indices are market cap weighted baskets of newly public companies. As of 5/25/2023, the Renaissance IPO Index was up 15.8% year-to-date, while the S&P 500 was up 8.9%. Renaissance Capital’s IPO ETF (IPO) tracks the index, and top ETF holdings include Snowflake (SNOW) and Airbnb (ABNB). The Renaissance International IPO Index was down 10.0% year-to-date, while the ACWX was up 6.2%. Renaissance Capital’s International IPO ETF (IPOS) tracks the index, and top ETF holdings include Porsche and Kuaishou.
Editor’s Note: The summary bullets for this article were chosen by Seeking Alpha editors.
