First IPO of 2016 on Tap This Week

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While 2016 initial public offerings (IPOs) are not starting the year with a bang, at least the first IPO of the year is scheduled to occur in the coming week. A second try is also on the calendar for a special-purpose acquisition (blank-check) company.

In 2015 a total of 170 companies launched into the public markets according to IPO ETF manager Renaissance Capital, and those companies raised a total of $30 billion. Of the total, 78 newly public companies came from the healthcare sector. In 2014, 275 companies came public and raised $85.3 billion. Renaissance Capital does not include “best efforts” or blank-check companies in its totals.

On the brighter side, 12 companies have already filed for IPOs in the first week of 2016, compared with none that had filed at the same time last year. Nine of the twelve were biotechs and that number represents more biotech IPO filings than in any week last year.

The first IPO of 2016 is Shimmick Construction Company Inc., a heavy civil construction company offering services to federal, state, and local public agencies and private customers in California and the Western United States. The company plans to offer 6.25 million shares in an expected price range of $11 to $13. Approximately half the shares are being sold by existing stakeholders, so the company’s proceeds at the midpoint of the range would be about $44.8 million at an implied market cap of $181.5 million. Sole bookrunner for the offering is FBR Capital Markets and co-managers are BB&T Capital Markets and D.A. Davidson. Shares are expected to price on Thursday and begin trading Friday on the Nasdaq under the ticker symbol SCCI.

The week’s second scheduled offering is blank-check company, Pulte Acquisition Corp., which plans to offer 7 million units at an IPO price of $10 per unit. Each unit comprises one share of common stock and one-half of one warrant. One warrant entitles the holder to purchase one share of common stock at an exercise price of $11.50 per share. Sole underwriter for the offering is Chardan Capital Markets. Units are expected to begin trading during the week of January 11th on the Nasdaq under the ticker symbol PLTEU.

Paul Ausick

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