Tag Archives: IPO

Mining blank check company files for $300 million IPO

ESM Acquisition Corporation has filed for a $300 million initial public offering (IPO).  The company has its head office in the River Oaks area.



The CEO of the company is Sir Mick Davis, who was the CFO of mining group Billiton plc (the predecessor to BHP Group) and the CEO of Xstrata plc, an Anglo-Swiss mining company that merged with Glencore plc in 2013. Until July 2019, Mr. Davis was the CEO and Treasurer of the British Conservative Party. He was born in South Africa but has British nationality. He is based in London.

The Chairman is John Raymond, who is Co-Founder and CEO of The Energy and Minerals Group, a leading natural resources-focused private equity firm, based in Houston. It manages funds of approximately $10 billion.

The company is seeking a “target that is positioned to benefit from the global transition towards a low carbon economy… In particular a target that explores for, mines, processes and/or refines commodities that are critical in order to achieve de-carbonization. Among other commodities, this may include cobalt, copper, graphite, lithium, manganese, nickel, palladium, platinum, rhodium, vanadium, rare earth elements, and/or other directly related raw materials.”

The company plans to list on the NYSE. Credit Suisse is the sole bookrunner on the deal.

S-1 filing – ESM Acquisition Corporation

 

Two more Houston blank check companies file for IPOs

On Friday 12 February, a record 28 blank check companies filed for Initial Public Offerings (IPO), including two old favorites in Houston. Tilman Fertitta filed for his 4th blank check company, Landcadia Holdings IV, while Graf Acquisition Corp filed their 2nd.



In case you are wondering why Friday was so popular it’s because it was the last day a company with a calendar year-end can file for an IPO using a September 2020 balance sheet.

Landcadia and Graf History

Landcadia Holdings IV filed for a $500 million IPO. As before, the shareholders are Tilman Fertitta and Jefferies. As before, they are seeking companies that operate in the consumer, dining, hospitality, entertainment and gaming industries.

  • Landcadia III just went public in October 2020 and raised $500 million in its IPO. Last month it agreed to buy The Hillman Group for $2.64 billion in a reverse takeover.
  • Landcadia II raised $275 million in May 2019 and acquired Golden Nugget Online Gaming (a Fertitta company) in December 2020.
  • Landcadia I raised $250 million in June 2016 and acquired Waitr in November 2018.

Graf Acquisition Corp II filed for a $225 million IPO, same as the first Graf IPO that was completed in October 2018. The CEO is James Graf. Graf I completed its reverse takeover of Velodyne Lidar in September 2020.

Popularity of SPACs

Special Purpose Acquisition Companies (SPACs) or blank check companies as they are also known, have really taken off in the past couple of years, mainly because of the disadvantages in the traditional IPO route where the process is long (6-7 months) and the valuation (i.e. price) at completion is uncertain.

Furthermore, the investment bankers like their IPOs to be heavily oversubscribed and for the share price to ‘pop’ on the first day of trading. But that means that the selling shareholders have effectively given up part of their returns to the new shareholders.

In contrast, a blank check company can go public in 2-3 months and then spend the next few months negotiating a deal in secret with a potential target company. In this way, both the original sponsor and the shareholders of the target can generate a better return.

S-1 Landcadia Holdings IV

S-1 Graf Acquisition Corp II

Another Houston E&P blank check company files for IPO

Flame Acquisition Corp has filed for a $250 million Initial Public Offering. It has its head office in downtown Houston.



The company is led by CEO and Chairman James Flores, the former CEO of Sable Permian Resources and prior to that, CEO of Plains Exploration and Production. The CFO is Gregory Patrinely, the former CFO of Sable. He also worked in the Oil and Gas division of Freeport-McMoRan, where Mr. Flores also worked for a time.

Sable Permian was formed in 2017 after it was spun off from American Energy Partners, which was formed by the late Aubrey McClendon, after he left Chesapeake. Sable filed for bankruptcy in June 2020. Mr. Flores and Mr. Patrinely left Sable days after if exited from Chapter 11 bankruptcy in February 2020.

The company is targeting opportunities in the the exploration and production and midstream sectors.

Cowen and Intrepid Partners are the joint bookrunners on the deal.

Last week, another Houston E&P blank check company, HNR Acquisition, filed for a $100 million IPO.

S-1 filing – Flame Acquisition Corp

E&P blank check company files for $100 million IPO

HNR Acquisition, a blank check company, has filed for an Initial Public Offering (IPO). It has its head office in the Greenway Plaza area of Houston.



The company plans to raise $100 million. Its sponsor and current 100% stockholder is Houston Natural Resources (HNR).  Its founder and CEO, Donald Goree, will also be the CEO of the blank check company.

HNR is currently involved in the recycling and remediation of oil-produced contaminates. It trades over-the-counter and has a market capitalization of $46 million. The company is currently completing two years of audited statements and has not yet filed to become an SEC reporting company.

The blank check company intends to focus on acquiring a business involved in exploration and production.

Kingswood Capital Markets is the sole bookrunner on the deal.

If HNR Acquisition completes its IPO, it will be the 8th Houston-area blank check company. Last week, one of those, Landcadia Holdings III announced a a proposed reverse takeover with The Hillman Group.

S1 filing – HNR Acquisition Corp

 

Insurance blank check company completes IPO

Delwinds Insurance Acquisition has completed its $200 million Initial Public Offering. It becomes the 7th Houston-area blank check company to go public this year. It will be listed on the NYSE.



The company was formed by The Gray Insurance Company and is based in downtown Houston. CEO Andrew Poole is an investment consultant at Gray while CFO Bryce Quin, is a process improvement specialist at Gray. They previously led a blank check company called Tiberius that went public in 2018. It subsequently acquired International General Insurance earlier this year.

Delwinds plans to target businesses in the insurance technology sector or brokers or carriers that use insurance technology (i.e. using data analytics or artificial intelligence to better price risk or automate back offices procedures).

https://www.globenewswire.com/news-release/2020/12/15/2145792/0/en/Delwinds-Insurance-Acquisition-Corp-Announces-Closing-of-201-250-000-Initial-Public-Offering.html

Aviation services blank check company completes IPO

Genesis Park Acquisition Corp, a Houston-based blank check company, has completed its initial public offering. It raised $150 million by offering 15 million units at $10 each. The company had originally planned to raise $200 million.



The company is led by chairman David Siegel, who is also Executive Chairman of an ultra-low-cost airline carrier, Sun Country Airlines. Together with CEO Paul Hobby (the Founding Partner of PE firm Genesis Park LP), they are seeking a business in the aviation sector with an enterprise value of between $500 million and $1 billion.  The CFO is Jonathan Baliff, former CFO and CEO at Bristow.

The company will be listed on the NYSE. It is the sixth Houston-area blank check company to list this year You can see the complete list of public companies in the Houston-area here.

https://www.prnewswire.com/news-releases/genesis-park-acquisition-corp-announces-pricing-of-150-million-initial-public-offering-301179336.html

Seven Houston companies have gone public in recent weeks

Seven Houston-area companies have completed their Initial Public Offerings (IPO) since the beginning of September.

Academy Sports & Outdoors, raised $203 million by selling 15.6 million shares at $13, well below the range of $15 to $17.  The shares (ACO) are currently trading at $14.76, giving the company a market capitalization of $1.3 billion.  It has its head office in Katy.



Kiromic Biopharma completed its IPO on October 15. The company initially filed back in May. It is based in the Medical center district and is developing immunotherapies for blood cancers and solid tumors. Kiromic raised $15 million by offering 1.3 million shares at $12. This was at the low end of the range $12 to $14. It is trading on the Nasdaq under the symbol KRBP.

Greenwich Life Sciences is another biotech company developing immunotherapies for breast cancer. The company, based in Stafford, raised $7 million by offering 1.3 million shares at $5.75 each. That was much lower than the original plan of raising $21.6 million at $7.50 to $8.50 each.

The remaining companies that went public are blank check companies.

Good Works Acquisition Corp raised $150 million. The company has its head office in the Galleria. It will trade on the Nasdaq under the symbol GWACU.

It is focused on finding a business in financial distress with an enterprise value of between $400 million and $600 million. Fred Zeidmann is the Chairman and CEO. He has served as Chairman of Gordian Group LLC, a U.S. investment bank specializing in board level advice in complex financial matters since December 2014.

Landcadia Holdings III completed its IPO on October 8. It raised $500 million and is listed on the Nasdaq under the symbol LCYAU. This is the third blank check company launched by Tilman Fertitta, CEO of Landry’s and Richard Handler, the CEO of Jefferies. As before, the company plans to acquire a business in the consumer, dining, hospitality or entertainment sectors.

Peridot Acquisition Corp has its head office in the River Oaks area. It raised $300 million and is listed on the NYSE under the symbol PDAC.U

The company is looking to buy a business that focuses on environmentally sound infrastructure, industrial applications and disruptive technologies that eliminate or mitigate greenhouse gas emissions. The target should have an enterprise value of between $800 million and $2 billion. Carnelian, a PE firm based in Houston, is backing the company. It has $1.8 billion in cumulative equity commitments in traditional E&P companies.

Industrial Tech Acquisitions raised $75 million. The company has its head office in the Galleria area. It is seeking to buy a technology business operating in the industrial or energy area. This includes software, mobile and IoT (Internet of Things) applications, cloud communications and ultra-high bandwidth services. Targets would have an enterprise value of between $250 million and $500 million.

The complete list of Houston-area public companies can be found here.

 

 

 

Industrial blank check company completes IPO

[UPDATE October 2021 – The company took Israeli company Arbe Robotics public in a transaction valuing the company at $573 million enterprise value. Arbe is developing 4D automotive imaging radar.]

Industrial Tech Acquisitions has completed its Initial Public Offering (IPO). It raised $75 million by offering 7.5 million units at $10 each.  The company initially filed last month and planned to raise $60 million.



Industrial Tech Acquisitions is seeking to buy a technology business operating in the industrial or energy area. This includes software, mobile and IoT (Internet of Things) applications, cloud communications and ultra-high bandwidth services. Targets would have am enterprise value of between $250 million and $500 million.

The company has its head office in the Galleria area and its CEO is Scott Crist. He has founded, run and exited a number of businesses in the technology, telecommunications and industrial sectors.

The company has 21 months from the closing of the IPO to finalize an acquisition, though that could be extended by a maximum of 9 months, if they are close to a deal.

Industrial Tech will be listed on the NASDAQ under the ticker symbol ‘ITACU’. The company joins two other Houston blank check companies that are publicly traded (Graf Industries and Landcadia Holdings II).

You can see the complete list of Houston-area public companies here

S-1 Final – Industrial Tech Acquisitions

Academy Sports + Outdoors files for IPO

Academy Sports and Outdoors has filed for an Initial Public Offering. In the filing document the company states that it plans to raise $100 million. However, this is just a placeholder. Renaissance Capital estimates that the company could raise up to $500 million.



Academy has its head office in Katy, TX. It was formed in San Antonio in 1938 when founder Max Gochman opened a tire store. The following year he started selling military surplus. The corporate office moved to Houston in 1978 and the company started selling sports and outdoor equipment in 1980. In 2011, the business was acquired by KKR, one of the largest PE firms.

The company now has 259 stores across 16 states. For the 12 months ending 1 August 2020, the business had revenues of $5.3 million. Adjusted EBITDA was $449 million. This number is before $17.6 million of costs related to the COVID-19 pandemic (primarily temporary wage premiums, cleaning supplies and accelerated freight costs).

For the 26 weeks ending Aug 2020, comparable sales are up 15.9% on the same period last year. Sales in the sports and recreation merchandise divisions are up 23%, while footwear and apparel are down 7% and 3% respectively. The company believes that the popularity of isolated recreation, outdoor and leisure activities has increased during the pandemic. Sales of firearms are also up.

The company has achieved four consecutive quarters with positive comparable sales.

Ken Hicks is the Chairman and CEO. He joined the company in May 2018 and was previously the CEO at Foot Locker. Michael Mullican has served as the CFO since January 2018. He joined Academy in February 2017 as its General Counsel. Prior to that, he was the Managing Director of Aureus Health Services, a specialty pharmacy.

No pricing terms were disclosed.

SEC filing – S-1 Academy Sports

Environmental blank check company files for IPO

Peridot Acquisition Corp is the latest Houston blank check company to file for an Initial Public Offering (IPO). The company plans to raise $300 million. It has its head office in the River Oaks area.



The company is looking to buy a business that focuses on environmentally sound infrastructure, industrial applications and disruptive technologies that eliminate or mitigate greenhouse gas emissions. The target should have an enterprise value of between $800 million and $2 billion.

Examples given include:

  • Clean fuel transportation, electrification and energy efficiency.
  • Environmental infrastructure (e.g recycling).
  • Carbon capture, utilization and storage.
  • Renewables.

Carnelian, a PE firm based in Houston, is backing the company. It has $1.8 billion in cumulative equity commitments in traditional E&P companies.

Management team

Alan Levande is the CEO of the company.  Most recently, he was the co-CEO of Covey Park Energy, a natural gas company that was sold to Comstock Resources (owned by Jerry Jones of the Dallas Cowboys) for $2.2 billion in June 2019. Prior to that, Mr Levande was a Co-Founder and Senior Managing Director at Tenaska Capital Management LLC, a $4 billion private equity manager focused on investments in the power and energy sectors, from 2003 to 2012.

Markus Specks is the CFO. He was most recently a Managing Director with Värde Partners, a global alternative investment advisor managing approximately $14 billion in assets, where he was employed from July 2008 to June 2020.

UBS Investment Bank and Barclays are the joint bookrunners on the deal.

Houston-area blank check companies

The company joins a stampede of blank check companies that have gone or are planning to go public this year. In Houston;

SEC filing – S-1 Peridot