Tag Archives: IPO

Corebridge $1.7 billion IPO largest in US this year

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Corebridge Financial, a carve-out of AIG’s retirement services and life insurance business, has announced the pricing of its Initial Public Offering (IPO). 80 million shares will be offered at $21 per share, the bottom end of the range.  The $1.7 billion raised is the largest IPO this year in the US.



Corebridge manages $358 billion in client assets as of June 30, 2022. It is a leading provider of annuities for individual retirement plans (1.2 million policies) and retirement plans for education, healthcare and government sectors (1.9 million customers).

The shares being sold are about 12% of the total float. AIG will own 78% of the shares while Blackrock will own 10%. All the proceeds will go to AIG.

Blackrock acquired its shares in 2021 for $2.2 billion. That was part of a deal where AIG agreed to transfer the management of $50 billion of Corebridge’s client assets to Blackrock. That figure will rise to $93 billion by 2027.

Houston head office

Corebridge has its head office on Allen Parkway in Houston. That connection is because the life insurance business was primarily built on AIG acquiring American General Corporation (AGC) in 2001 for $23 billion. AGC was founded in 1926 by Gus Wortham, who was one of the Houston’s major civic leaders.

Management

Kevin Hogan, the CEO of Corebridge, has been in that position since 2014. According to LinkedIn, he is based in New York as is Elias Habayeb, the CFO. He has been in that role for almost a year. Both Mr. Hogan and Mr. Habayeb are long-time AIG employees, though, interestingly both left and then rejoined AIG.

The carve-out from AIG is expected to cost between $350 million and $450 million as the company rebrands and replaces systems and infrastructure provided by AIG.

Corebridge will list on the NYSE with the ticker ‘CRBG’

https://www.businesswire.com/news/home/20220914006004/en/AIG-Announces-Pricing-of-Corebridge-Financial-Inc.-Initial-Public-Offering

 

LNG services company completes IPO

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Excelerate Energy has completed its initial public offering by raising $384 million. The company  offered 16 million shares at $24 per share. This was at the high end of the range of $21 to $24 and values the company at over $2.5 billion.



The company originally filed back in January, but war in Ukraine has increased interest in LNG.

Excelerate, which has its head office in The Woodlands, provides flexible LNG infrastructure solutions, primarily in emerging markets. The company has a fleet of 10 Floating Storage Regasification units (FSRU).

Natural gas is cooled to approximately -160C at the source of production to reduce its volume down for transportation on an LNG carrier. The LNG needs to be brought back to its gas state at the area of consumption. One option is to have an LNG facility constructed on land, another is to do it offshore using a FSRU. The latter is often cheaper and quicker, especially in emerging markets.

Excelerate was formed in 2003 by George Kaiser, a Tulsa-based investor who is also the majority owner in BOK Financial Corporation (which also operates under the brands of Bank of Oklahoma and Bank of Texas).

For the 12 months ended September 2021, the company had revenues of $658 million. Currently the company has eight contracts in place for delivering regasified LNG to customers in Argentina, Brazil, Bangladesh, Israel, Pakistan and the UAE.

Steven Kobos has been the CEO of Excelerate since March 2018 and served as its counsel for the previous 11 years. Dana Armstrong is the CFO. She joined in April 2020 and was previously the CFO at Scientific Drilling.

S-1 filing – Excelerate Energy

Houston AdTech company completes $15 million IPO

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Direct Digital Holdings, an AdTech company based in the Galleria, has completed its initial public offering. It raised $15 million by offering 2.8 million units (20%) at $5.50.

The company originally planned to offer 4 million shares at a range of $7 to $9. The recent stock market turbulence caused the company to reduce terms twice.



The company is a full-service advertising platform, primarily focused on providing advertising technology, data-driven campaign optimization to underserved and less efficient markets. The business was formed in 2018 by the merger of Huddled Masses (which focused on the buy-side) and Colossus Media (sell-side).

Expensive acquisition

However, digging into the S-1 registration statement, you find the real reason for the IPO.

In September 2020, the business acquired Orange142, a buy-side digital advertising business, based in Austin, for $26.2 million.  $12 million was paid in cash, funded by a term loan with a 16% interest rate. The rest was funded by an issue of shares ($4.3 million) and mandatory redeemable units ($9.9 million, that have an interest rate of approximately 8%).

For 2019, Orange142 had revenues of $17 million. However, it had a large client who transitioned their work in-house right after the acquisition. That client had revenues of $5.7 million in the 9 months to September 2020, but only $0.7 million in the 9 months to September 2021.

The proceeds of the IPO are being used to buy out the seller of Orange142 by buying back the shares and mandatory redeemable units.

Customers

For the 9 months to September 2021, the company had approximately 158 customers on the buy-side . These are advertising buyers at small and mid-size companies and advertising agencies. In the same time, the company worked on 1,300 individual campaigns. Sell-side clients include the US Army, Just Energy, and Visit Colorado Springs.

For the 9 months to September 2021, the company had revenues of $25 million and adjusted EBITDA of $4.5 million. The revenue was a 29% increase on the prior period, with the original business growing 57% and Orange142 growing 17% (even after the customer loss).

Management

The business was formed by Mark Walker (who acts as Chairman & CEO) and Keith Smith (who is the President). Each owned 50% prior to the IPO. Both hold B.A. in Economics from The University of Texas.

Mr. Walker worked for NRG Energy from 2005 to 2016. From October 2016 to May 2019, he worked at CVG Group, a private equity firm, primarily as Acting COO for Ebony Media Operations.

Mr. Smith has an investment banking background and has worked for Standard & Poor’s, Rabobank International and Capital Point Partners. Most recently, he was CEO at Parkview Capital Credit, where he invested and managed more than $75 million with small and mid-sized companies to provide acquisition and capital growth.

Mr. Smith also acted as the CFO of the company, until the hire of Susan Echard in 2021. She originally joined the company as a consultant at SeatonHill LLC in February 2021. She became the CFO in May and a full-time employee in January 2022.

The shares will be listed on the Nasdaq under the symbol DRCT.

SEC filing – Direct Digital Registration Statement

 

Mattress Firm files for Initial Public Offering

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Source: Social Woodlands

Mattress Firm has filed for an Initial Public Offering, five years after it was acquired by Steinoff International for $3.8 billion. The company has its head office in downtown Houston.

The company has not yet determined how much it plans to raise in its IPO.



Mattress Firm entered and exited Chapter 11 in late 2018 to shed itself of 640 unwanted stores. As part of the process, the lenders who provided the exit financing also acquired a 49.9% stake in the business from Steinhoff.

Steinhoff $7.4 billion fraud

Steinhoff was founded in Germany in 1964 and moved its head office to South Africa in 1998. In late 2017, the company announced accounting irregularities in its European operations. A PwC report ultimately published in 2019 found that a small group of Steinhoff executives had recorded fictitious transactions totaling $7.4 billion over a period between 2009 and 2017.

Steinhoff has proposed a global $1.6 billion settlement with investors harmed by the fraud. To help pay for this, in September 2021, Mattress Firm paid a special distribution to its shareholders of $1.2 billion. Steinhoff, as 50.1% owner, got $601 million. The special distribution was financed by new term loan of $1.25 billion. Of this, $523 million was used to pay off the old term loan taken out as part of the Chapter 11 proceedings.

Improved financial performance

Mattress Firm now has 2,353 stores, down from almost 3,500 when it was last a public company. Impressively, revenue per store has grown from $1 million in 2019 to $1.7 million in the year to September 2021. Adjusted EBITDA margins have grown from $153 million (5.2%) in 2019 to $669 million (15.2%) in 2021.

As o September 2021, the company has $1.0 billion of net debt and $77 million of stockholder equity. Included on the balance sheet is $1.5 billion of goodwill and intangibles.

Management paid $135 million

As part of the special distribution, in addition to the $1.2 billion paid to the shareholders, senior management received $135 million in cash bonuses in September 2021. John Eck, CEO since December 2019, received $39.2 million. Maarten Hager, CFO since February 2020, received $11.75 million. The top five executive officers received $75 million.

In addition, four non-exec directors of Mattress Firm also received $3.845 million each as part of the $135 million payout.

S-1 firm Mattress Firm

Nabors Energy Transition Corp completes $276 million IPO

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Nabors Energy Transition Corp (NETC) has completed its upsized Initial Public Offering by selling 27,600,000 units at $10 apiece.



The SPAC or blank check company intends to acquire a company that is involved in energy transition such as alternative energy, energy storage, emissions reduction and carbon capture.

The sponsor of the SPAC is a company co-owned by Nabors Industries, a global leader in land-based drilling rigs and Tony Petrello, the current Chairman and CEO of Nabors.

In fact, all the management team of the SPAC are employed by Nabors including William Restrepo (CFO), Guillermo Sierra (VP – Energy Transition) and Siggi Meissner (President of Engineering and Technology).

The management team will not be paid a salary by the SPAC until it closes on a transaction. However, to me, it appears that there is plenty of scope for conflicts of interest. In the prospectus, NETC states that ‘potential conflicts with Nabors are naturally mitigated by the differing nature of the investments that Nabors would consider more suitable’.

In August, Nabors issued a press release that ‘it continues investment in energy transition with Quaise Inc’. It provided $12 million in financing to Quiase, a company developing millimeter wave drilling technology to access deep geothermal energy. That technology appears to be within the remit of the SPAC, even if the size isn’t.

https://www.prnewswire.com/news-releases/nabors-energy-transition-corp-announces-closing-of-276-000-000-initial-public-offering-including-full-exercise-of-underwriters-option-to-purchase-additional-units-301429394.html

 

 

 

Third Coast Bank completes $88 million IPO

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Third Coast Bank, a community bank based in Humble, has completed its initial public offering (IPO). It raised $88 million by offering 3.5 million shares at $25, the mid-point of the range.

Yesterday, two large publicly-traded Houston community banks, Allegiance and CBTX, announced they would merge.



The bank has total assets of $2 billion. It has 12 branches mostly in small towns close to large metropolitan areas. It has 5 in the Houston-area, 2 in Dallas/Plano, 2  around San Antonio, 2 in Beaumont, 1 in Austin and 1 in Detroit, TX. Some of those came with the acquisition of Heritage Bank in January 2020.

Third Coast was formed in 2008 by founder and CEO Bart Caraway. He was previously the CFO and COO at Houston-based Patriot Bank.

The CFO is John McWhorter.  He joined in January 2021 and was previously CFO at Bank of Houston and Cadence Bank

S-1 filing – Third Coast Bank

Energy transition SPAC completes $175 million IPO

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Pyrophyte Acquisition Corp has completed its $175 million initial public offering (IPO). The blank check company has its head office in the River Oaks area of Houston.

The company is seeking targets involved in energy transitions. That could mean renewable power generation, energy storage, zero-emission transportation, carbon capture or zero/low-carbon industrial applications.



The chairman of the company is Dr. Bernard Duroc-Danner. In 1987 he was hired to start up the oilfield services business of EVI. 47 acquisitions later, he retired as Chairman and CEO of Weatherford in 2016. In 2018, he co-founded a start-up of an artificial intelligence software company with applications in wind renewable energy.

Sten Gustafson is the CEO. From 2012 to 2014 he was the CEO of ERA Group, the Houston-based helicopter company that was spun out of Seacor in 2013. Since 2018, he was served as the Chairman of Golden Energy Offshore, a Norwegian operator of offshore service vessels.

The CFO is Thomas Major who spent ten years at NOV, including five as Director of Corporate Development.

The company is the fourth Houston-based SPAC or blank check company to go public since the beginning of last week. You can read about the others here and here.

https://www.globenewswire.com/news-release/2021/10/26/2321254/0/en/Pyrophyte-Acquisition-Corp-Announces-Pricing-of-175-Million-Initial-Public-Offering.html

 

Oilfield water company completes IPO

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Aris Water Solutions has completed its initial public offering (IPO). It raised $214 million at $13 per share. That price was below the IPO range of $16-$18 per share. The company has its head office in the Memorial City area.



The company is involved in gathering, transporting and handling produced water generated from oil and natural gas production. In addition, it develops and operates recycling facilities to treat and recycle produced water. The company has 640 miles of produced water pipeline, 48 water handling facilities and 10 recycling facilities. These facilities are located in the Permian Basin.

The business (technically, the predecessor company, Solaris Midstream) was formed in 2016 by Bill Zartler, founder and Executive Chairman. Trilantic Capital and Yorktown Energy Partners backed the company. Mr. Zartler is also the founder and CEO of Solaris Oilfield Infrastructure, which went public in 2017.

For the six months to June 2021, the company had revenues of $103 million.

The CEO is Amanda Brock. She is the former CEO of Water Standard and served as the President of the Americas for Azurix, a business spun out of Enron in 1999.

Brenda Shroer is the CFO. She joined the company as an employee in June 2021 but has been on the board since July 2019. At that time she was the CFO of Concho Resources. Concho took a 20% stake in Aris in July 2019 when it sold produced water assets to the company for $330 million. Concho was acquired by ConocoPhillips earlier this year.

Aris SEC registration statement

 

Sports Technology blank check company goes public

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Sportsmap Tech Acquisition, a blank check company, has completed its $100 million Initial Public Offering (IPO). The company is based in the Galleria area of Houston.



The business aims to make an acquisition in sports technology such as wearables, data analytics, new methods of fan engagement, and new esports and gambling platforms.

The CEO of the company is David Gow. In 2007, Mr. Gow formed Gow Media, a multi-platform media company that included ESPN Radio Houston and digital content sites such as CultureMap. He was also the CFO and later CEO of Houston-based Ashford.com which went public in 1999. At one point, the company was the largest luxury retailer online. Prior to that, Mr. Gow was the Director of Corporate Strategy at Compaq.

A couple of names well known to Houston sports fans are also Directors;

  • Reid Ryan, former President of the Houston Astros. He is the son of Nolan Ryan.
  • Oliver Luck, former General Manager of the Houston Dynamo and former CEO of the Houston Sports Authority.  He is the father of Andrew Luck, the number one draft pick in 2012.

Jacob Swain serves as the CFO. Between March and November 2019, he was the CFO and Chief Technology Officer at Bellatorum Resources, a mineral rights investment firm that later shut down due to fraud. Prior to that, he worked at BBB Tank Services between 2009 and 2016, first as CFO, later as CEO.

S-1 filing – Sportsmap Tech Acquisition

https://www.businesswire.com/news/home/20211018006029/en/SportsMap-Tech-Acquisition-Corp.-Announces-Pricing-of-100000000-Initial-Public-Offering

Houston Ecommerce blank check company completes $175 million IPO

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Mercury Ecommerce Acquisition Corp has completed its $175 million Initial Public Offering. The Special Purchase Acquisition Corporation (SPAC), otherwise known as a blank check company, is seeking companies offering Software-as-a-Service (‘SaaS’) to enterprise customers.



The company has its head office in the Greenway Plaza area of Houston. The company is led by Chairman Blair Garrou, the co-founder and Managing Director of Mercury Fund, an early-stage venture capital firm. Previously, he was the Director of Operations for the Houston Technology Center and led the formation of the Houston Angel Network.

CEO Andrew White currently serves as a Special Limited Partner for Mercury Fund. He also his own investment vehicle where he has grown and sold a couple of businesses. He is the son of former Texas Governor, Mark White (1983-1987) and ran for the Democratic nomination for Governor in 2018, losing in the run-off to Lupe Valdez.

CFO Winston Gilpin is the founding CFO of Mercury Fund. He also is the co-founder of GSqr Consulting where he provides both fund administrative services to small venture funds and accounting services to Houston startups.

S-1 filing – Mercury Ecommerce