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IndiaMART IPO opens today; should you invest? Here’s what analysts advise

The initial public offering (IPO) of IndiaMART InterMESH, India’s largest online business-to-business (B2B) marketplace for business products and services, opens on Monday. Through this issue, the company is offloading 4.89 million shares. The price band of the IPO, which is entirely an offer for sale (OFS), has been fixed at Rs 970 to Rs 973 per share. At the upper end of the price band, the company aims to raise around Rs 475 crore.

On Friday, raised around Rs 214 crore by allotting 2,195,038 equity shares at Rs 973 apiece to 15 anchor investors, including ICICI Mutual Fund, HDFC Mutual Fund, SBI Mutual Fund, Birla Mutual Fund, SAIF Partners, Hornbill Capital Advisers LLP and Malabar India.

Financials

IndiaMART had a negative net worth of Rs 390 crore as on March 31, 2017, and Rs 321.26 crore in 2018. As on March 31, 2019, its net worth had turned positive, at Rs 1,598.88 million. “Its negative net worth as on March 31, 2017, and in 2018 was primarily on account of its operating losses and net loss/(gain) on financial assets and liabilities designated at fair value through profit or loss (FVTPL) in the respective fiscal/period,” notes HDFC Securities.

The company has witnessed consistent growth in its revenue over the past three financial years. In FY17, the company’s revenue stood at Rs 317.8 crore, while in FY18 and FY19 it grew to Rs 410.51 crore and Rs 507.42 crore, respectively. It posted a loss of Rs 64 crore in FY17. In FY18, its adjusted profit after tax (PAT) came in at Rs 55 crore. But in FY19, it de-grew to Rs 20 crore.

Should you subscribe?

Analysts’ views appear divided on the While some believe investors with a long-term view should subscribe to it, as the business has immense growth potential. Yet there also are experts who advise giving it a miss, given the volatility in the secondary market, the company’s poor financials and limited growth potential in the B2B segment.

For instance, Ravi Singh, head of research, Karvy Broking, says: “At present, the issue might look a bit expensive but over the long term it will reward investors. Over the next 12 months, the stock will rally over 70 per cent to Rs 1,650-1,670.” Government push for and expected growth in SMEs will significantly benefit IndiaMART, he believes.

Based on FY20E and FY21E earnings per share, the stock is valued at P/E (price-to-earnings) multiples of 35.1x and 25.9x, respectively, which is at a premium to the peer average of 21.5x and 15.3x, observes in the preview note.

Analysts at the brokerage say: “Such companies with technological and scalable business model should not be valued merely on the profitability but also on the future market potential and the capabilities of the management to work towards achieving the potential. Thus, we assign a ‘SUBSCRIBE’ rating for the issue.”

On the other hand, Umesh Mehta, head of research, Samco Securities, advises against investing in the IPO, given the company’s poor financial performance over the past few years. “If you look at the financial history of the past five years, only last year it made a profit. Otherwise, it had been incurring losses. The company’s earnings per share has been just 4.87; and in the past few years it was quite negative.” Moreover, demand for B2B e-commerce is not as much as B2C (business-to-consumer), which is in the market through digitalisation, Mehta adds.

Source: Ipo Search Results
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Velodyne Lidar hires bankers for an IPO – Business Insider

A Velodyne LiDAR sensor is seen mounted on a self-driving vehicle during a self-racing cars event at Thunderhill Raceway in Willows, California, U.S., April 1, 2017. REUTERS/Stephen Lam

(Reuters) – Autonomous vehicle technology company Velodyne Lidar has hired bankers for an initial public offering, Business Insider reported on Saturday, citing sources familiar with the process.

The San Jose, California-based company is working with Bank of America Merrill Lynch, Citigroup Inc, Royal Bank of Canada, and William Blair for a potential IPO, the report said.

Velodyne is looking to surpass its private valuation of $1.8 billion and go public before the end of 2019, Business insider added, citing a source.

Nikon Corp invested $25 million in the self-driving car technology company in December 2018.

Velodyne Lidar did not respond to Reuters’ request for comment outside regular business hours.

Reporting by Ishita Chigilli Palli in Bengaluru; Editing by Daniel Wallis

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Congressional Men’s Health Caucus Briefing Sheds Light on State of Men and Women’s Health


Congressional Men’s Health Caucus Briefing Sheds Light on State of Men and Women’s Health – World News Report – EIN News

























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IT buyers platform G2 looking at IPO to expand global footprint

Business software marketplace is planning for an IPO to expand its global presence.

is a where they can discover and buy software and avail of service to solve specific issues.

“We’ve raised funds and acquired Also, we are now financially in a good position. is looking at IPO as the next phase of its growth,” G2 co-founder and president Tim Handorf told PTI Saturday.

The company is excited to grow with its office in Bengaluru known for its technology innovation and talent, he said.

The city is a perfect place for G2 to expand its footprint to help businesses, he added.

The company provides customers and people’s reviews and compares them with competitors.

There are more than 7,85,000 independent and authenticated user reviews read by more than three million buyers each month on the company’s platform, Handorf said.

It is spread across nearly 100,000 products in over 1,000 categories, he said.

Themodel brings transparency to B2B buying to change the way decisions are made, Handorf said.

Inaugurating G2’s headquarters earlier, he said the company makes it easy for businesses to select and manage technology in a world where options are growing exponentially and their technology decisions would have a tremendous impact on their success.

The company had acquired Siftery, a startup based out of India, which builds its own database of business software to provide service to businesses.

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U.S. IPO Weekly Recap: WORK’s Direct Listing Works As Slack And 6 Others Go Public

Slack’s (NYSE:WORK) widely-covered direct listing was hailed as a success.

Slack opened on Thursday at $38.50, well above the NYSE’s “reference price” of $26, and more than triple its last round less than a year ago. And yet, new public investors ended the week with losses. The stock closed Friday at $37.22, down 3.3% from the opening trade. With millions of users and fast growth, Slack is a very strong story, but with a diluted market value of about $23 billion (~48x LTM sales), it is not a cheap story.

In addition to Slack, six companies went public via traditional IPO, including four biotechs, one gene sequencer, and a discount grocer.

6 IPOs, a SPAC, and a Direct Listing During the Week of June 17th, 2019

Issuer
Business

Deal
Size

Market Cap
at IPO

Price vs.
Midpoint

First Day
Return

Return
at 06/21

Personalis (NASDAQ:PSNL)

$135M

$567M

13%

+68%

+78%

Provides a genome sequencing platform for cancer drug development.

Stoke Therapeutics (NASDAQ:STOK)

$142M

$634M

20%

+42%

+52%

Preclinical biotech developing RNA-targeted therapies for rare genetic diseases.

Slack

$7,367M

$15,580M

0%

+49%

+43%

Provides a workplace messaging application.

Grocery Outlet Holdings (NASDAQ:GO)

$378M

$2,077M

38%

+30%

+30%

Operates a network of more than 300 independently run discount grocery stores.

Akero Therapeutics (NASDAQ:AKRO)

$92M

$471M

7%

+15%

+23%

Early stage biotech developing therapies for NASH and other metabolic diseases.

Atreca (NASDAQ:BCEL)

$125M

$484M

0%

+6%

+0%

Preclinical biotech developing immunotherapies for solid tumors.

South Mountain Merger (SMMCU)

$225M

$275M

0%

+0%

+0%

Blank check company led by former CardConnect executives and focused on the fintech industry.

Prevail Therapeutics (NASDAQ:PRVL)

$125M

$648M

0%

-20%

-15%

Early stage biotech developing gene therapies for neurodegenerative diseases.

Personalis was the week’s top performer, pricing an upsized IPO above the range and finishing with a gain of 78%. The gene sequencing company targets a $5 billion market opportunity, and saw its sales jump 300% in 2018 to $38 million.

Two biotechs traded up, two traded down/flat, and one postponed

Stoke Therapeutics was the week’s top biotech with a 52% gain. The preclinical biotech priced above the range to raise $142 million at a diluted valuation of $634 million. While early stage, Apple Tree-backed Stoke boasts an experienced management team and a platform with multiple applications.

Led by the former CMO of Gilead and also backed by Apple Tree, Akero Therapeutics priced at the high end and finished the week up 23%. The company is relatively early stage, and going after the liver disease NASH, which has a large opportunity with no FDA-approve therapy.

Developing gene therapies for Parkinson’s and other diseases, Prevail Therapeutics priced at the midpoint to raise $125 million at a diluted market cap of nearly $650 million, but plummeted 20% on its first day. Preclinical immuno-oncology biotech Atreca priced at the midpoint and finished the week just 0.4% above issue.

LBO’d by Hellman & Friedman, Grocery Outlet Holdings offered investors one of the few public grocers with a history of strong growth (10% in 2018; +3.9% comp growth). The company priced a whopping 38% above its midpoint and finished the week with a 30% gain.

Dermavant Sciences (DRMT) postponed its $100 million offering. While the company has a late-stage candidate, investors may have been turned off by milestone obligations, poor trading from other Roivant IPOs, and an unusual loan on its balance sheet.

7 Filings During the Week of June 17th, 2019

Issuer
Business

Deal
Size

Sector

Lead
Underwriter

Fulcrum Therapeutics (FULC)

$86M

Health Care

Morgan Stanley

Clinical-stage biotech developing therapies based on gene regulation for rare diseases.

Medallia (MEDAL)

n/aM

Technology

BofA ML

Enterprise customer experience and feedback management platform.

Mirum Pharmaceuticals (MIRM)

$86M

Health Care

Citi

Clinical-stage biotech developing therapies for rare liver diseases.

Phreesia (PHR)

$125M

Technology

JP Morgan

Provides a patient-intake software platform for healthcare providers.

SC Health Corp (SCH.U)

$150M

SPAC

Credit Suisse

Blank check company targeting the Asian Pacific healthcare industry.

AMTD International (AMTDI)

$200M

Financials

AMTD Global

Hong Kong-based financial services firm and investment bank.

Tuscan Holdings Corp II (THCAU)

$125M

SPAC

EarlyBird

Second blank check company led by Stephen Vogel targeting the cannabis industry.

IPO Market Snapshot

The Renaissance IPO Indices are market cap weighted baskets of newly public companies. As of 6/20/19, the Renaissance IPO Index was up 39.8% year-to-date, while the S&P 500 had a gain of 19.0%. Renaissance Capital’s IPO ETF (NYSE: IPO) tracks the index, and top ETF holdings include Okta (NASDAQ:OKTA) and Elanco (NYSE:ELAN). The Renaissance International IPO Index was up 13.2% year-to-date, while the ACWX was up 13.7%. Renaissance Capital’s International IPO ETF (NYSE: IPOS) tracks the index, and top ETF holdings include SoftBank and Xiaomi.

Editor’s Note: The summary bullets for this article were chosen by Seeking Alpha editors.

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U.S. IPO Week Ahead: Tech And Big Biotech Fill Up A 9-IPO Week

Nine IPOs are scheduled to raise $2.1 billion in the week ahead. Tech and healthcare continue to dominate the IPO market, with four of each this coming week. New filings should also pick up, as companies target post-July 4th launches.

McKesson/Blackstone’s Change Healthcare (CHNG) is the week’s largest IPO, aiming to raise $750 million from common stock, plus $250 million in convertible units. Providing billing and collections software and services used by various healthcare providers, Change’s sticky solution booked $3.3 billion in sales with strong EBITDA margins (28% in FY19), though the company is highly levered, and recently had weak results in some of its largest business units.

The RealReal (REAL) is raising $270 million at a proposed $1.7 billion valuation. The online luxury consignment store is a second act for the founder of Pets.com, who leads the company as co-founder and CEO. Several fast-growing e-commerce IPOs have outperformed this year (Chewy (NYSE:CHWY), Revolve (NYSE:RVLV)), though RealReal has the highest losses by far (-29% EBITDA margin).

Brazil-based Linx (LINX) is raising about $250 million in its US IPO. Like last year’s US IPOs PagSeguro (NYSE:PAGS) and StoneCo (NASDAQ:STNE), Linx provides payment solutions in Brazil, though its core software helps retailers turn POS transaction data into insights that can be analyzed on an ERP system. Listed in Brazil, the company grew sales by 20% in 2018 to $179 million, with a 10% net margin.

As we recently described in a special IPO commentary, June’s flood of biotechs continues this week, including two that are coming public valued at more than $1.5 billion. Viking-backed Adaptive Biotechnologies (ADPT) is a hybrid diagnostics/biotech company, with a fast-growing immuno-sequencing business and a pipeline of preclinical candidates. KKR-backed BridgeBio Pharma (BBIO) has a massive pipeline of 16 clinical programs, mainly focused on genetic diseases.

U.S. IPO Calendar

Issuer
Business

Deal Size
Market Cap

Price Range
Shares Filed

Top
Bookrunners

Cambium Networks (CMBM)
Rolling Meadows, IL

$81M
$363M

$13 – $15
5,800,000

JP Morgan
Goldman

Provides wireless broadband networking products.

Linx
São Paulo, Brazil

$254M
$1,636M

$8.68
29,274,601

Goldman
Morgan Stanley

Brazilian provider of POS/ERP connectivity software and payment services.

Adaptive Biotechnologies
Seattle, WA

$200M
$2,098M

$15 – $17
12,500,000

Goldman
JP Morgan

Provides genetic immunosequencing tests used to diagnose and treat diseases.

BridgeBio Pharma
Palo Alto, CA

$225M
$1,725M

$14 – $16
15,000,000

JP Morgan
Goldman

Late-stage biotech developing therapies for genetic diseases and cancers.

Change Healthcare
Nashville, TN

$750M
$5,401M

$16 – $19
42,857,144

Barclays
Goldman

Provides healthcare revenue cycle management software and services.

Morphic Holding (MORF)
Waltham, MA

$75M
$450M

$14 – $16
5,000,000

Jefferies
Cowen

Preclinical biotech developing oral small-molecule integrin inhibitors for chronic diseases.

Priam Properties (PRMI)
Nashville, TN

$171M
$222M

$18 – $20
9,000,000

BofA ML
Baird

Newly-formed REIT focused on office properties in the Midwest and Southeast.

Karuna Therapeutics (KRTX)
Boston, MA

$70M
$377M

$15 – $17
4,375,000

Goldman
Citi

Phase 2 biotech developing therapies for schizophrenia and other CNS disorders.

The RealReal
San Francisco, CA

$270M
$1,633M

$17 – $19
15,000,000

Credit Suisse
BofA ML

Authenticated online luxury consignment store.

*US IPO – Linx S.A. is currently listed in Brazil

Adaptive Biotechnologies, which provides genetic immunosequencing tests used to diagnose and treat diseases, plans to raise $200 million by offering 12.5 million shares at a price range of $15.00 to $17.00. At the midpoint of the proposed range, it would command a market value of $2.1 billion. Adaptive, which was founded in 2009, booked $59 million in sales over the last 12 months. The Seattle, WA-based company plans to list on the Nasdaq under the symbol ADPT. Goldman Sachs, J.P. Morgan, BofA Merrill Lynch, Cowen and Guggenheim are the joint bookrunners on the deal.

BridgeBio Pharma, a late-stage biotech developing therapies for genetic diseases and cancers, plans to raise $225 million by offering 15.0 million shares at a price range of $14.00 to $16.00. At the midpoint of the proposed range, it would command a market value of $1.7 billion. The Palo Alto, CA-based company was founded in 2015 and plans to list on the Nasdaq under the symbol BBIO. J.P. Morgan, Goldman Sachs, Jefferies, SVB Leerink and five others are the joint bookrunners on the deal.

Cambium Networks, which provides wireless broadband networking products, plans to raise $81 million by offering 5.8 million shares at a price range of $13.00 to $15.00. At the midpoint of the proposed range, it would command a market value of $363 million. Cambium Networks, which was founded in 2011, booked $251 million in sales over the last 12 months. The Rolling Meadows, IL-based company plans to list on the Nasdaq under the symbol CMBM. J.P. Morgan and Goldman Sachs are the joint bookrunners on the deal.

Change Healthcare, which provides healthcare revenue cycle management software and services, plans to raise $750 million by offering 42.9 million shares at a price range of $16.00 to $19.00. At the midpoint of the proposed range, it would command a market value of $5.2 billion. Change Healthcare, which was founded in 2005, booked $3.3 billion in sales over the last 12 months. The Nashville, TN-based company plans to list on the Nasdaq under the symbol CHNG. Barclays, Goldman Sachs, J.P. Morgan, BofA Merrill Lynch and five others are the joint bookrunners on the deal. The company also plans to raise $250 million in a concurrent offering of convertible tangible equity units at $50 per unit.

Karuna Therapeutics, a Phase 2 biotech developing therapies for schizophrenia and other CNS disorders, plans to raise $70 million by offering 4.4 million shares at a price range of $15.00 to $17.00. At the midpoint of the proposed range, it would command a market value of $377 million. The Boston, MA-based company was founded in 2009 and plans to list on the Nasdaq under the symbol KRTX. Goldman Sachs, Citi and Wells Fargo Securities are the joint bookrunners on the deal. Insiders intend to purchase up to $30 million of the IPO (43% of the deal).

Linx, a Brazilian provider of POS/ERP connectivity software and payment services, plans to raise $254 million by offering 29.3 million shares at a price of $8.68, its as-converted price on the Brasil Bolsa Balcão (ticker: LINX3). At that price, Linx would command a market value of $1.6 billion. Linx, which was founded in 2004, booked $183 million in sales over the last 12 months. The São Paulo, Brazil-based company plans to list on the NYSE under the symbol LINX. Goldman Sachs, Morgan Stanley, Jefferies, BofA Merrill Lynch and Itau BBA are the joint bookrunners on the deal.

Morphic Holding, a preclinical biotech developing oral small-molecule integrin inhibitors for chronic diseases, plans to raise $75 million by offering 5.0 million shares at a price range of $14.00 to $16.00. At the midpoint of the proposed range, it would command a market value of $450 million. The Waltham, MA-based company was founded in 2014 and plans to list on the Nasdaq under the symbol MORF. Jefferies, Cowen, BMO Capital Markets and Wells Fargo Securities are the joint bookrunners on the deal. Insiders intend to purchase up to $30 million of the IPO (40% of the deal).

Priam Properties, a newly-formed REIT focused on office properties in the Midwest and Southeast, plans to raise $171 million by offering 9.0 million shares at a price range of $18.00 to $20.00. At the midpoint of the proposed range, Priam Properties would command a market value of $222 million. The Nashville, TN-based company was founded in 2018 and plans to list on the NYSE under the symbol PRMI. BofA Merrill Lynch, Baird and RBC Capital Markets are the joint bookrunners on the deal.

The RealReal, an authenticated online luxury consignment store, plans to raise $270 million by offering 15.0 million shares at a price range of $17.00 to $19.00. At the midpoint of the proposed range, The RealReal would command a market value of $1.6 billion. The RealReal, which was founded in 2011, booked $230 million in sales over the last 12 months. The San Francisco, CA-based company plans to list on the Nasdaq under the symbol REAL. Credit Suisse, BofA Merrill Lynch, UBS Investment Bank, KeyBanc Capital Markets and Stifel are the joint bookrunners on the deal.

IPO Market Snapshot

The Renaissance IPO Indices are market cap weighted baskets of newly public companies. As of 6/20/19, the Renaissance IPO Index was up 39.8% year-to-date, while the S&P 500 had a gain of 19.0%. Renaissance Capital’s IPO ETF (NYSE: IPO) tracks the index, and top ETF holdings include Okta (NASDAQ:OKTA) and Elanco (NYSE:ELAN). The Renaissance International IPO Index was up 13.2% year-to-date, while the ACWX was up 13.7%. Renaissance Capital’s International IPO ETF (NYSE: IPOS) tracks the index, and top ETF holdings include SoftBank and Xiaomi.

Editor’s Note: The summary bullets for this article were chosen by Seeking Alpha editors.

Source: Ipo Search Results
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Akero Therapeutics Announces Pricing Of Initial Public Offering



Wednesday, 19 Jun 2019 09:20pm EDT 

Akero Therapeutics Inc ::AKERO THERAPEUTICS ANNOUNCES PRICING OF INITIAL PUBLIC OFFERING.AKERO THERAPEUTICS INC – PRICING OF ITS INITIAL PUBLIC OFFERING OF 5,750,000 SHARES OF COMMON STOCK AT A PUBLIC OFFERING PRICE OF $16.00 PER SHARE. 

Source: Initial Public Offering Search Results
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Slack to use uncommon IPO method: report

Workplace messaging platform Slack is set to use an uncommon listing strategy for its initial public offering (IPO) on Thursday, Reuters reported.

Using a direct listing, which differs from a traditional IPO in that it does not raise fresh funds, could likely yield a $16 billion valuation on the New York Stock Exchange.

The direct listing model was used by music streaming giant Spotify when it went public last year.

“We think the jury is out on whether this is the right move or not,” Kathleen Smith, a principal and manager of IPO ETFs at Renaissance Capital, told Reuters. “Looking at Spotify, it takes a little time for the stock to get established after a direct listing.”

Slack’s public debut comes shortly after the listings of ride-hailing companies Uber and Lyft, which both had disappointing starts to trading.

Spotify’s direct listing in April 2018 was perceived as a success at the time, with a healthy number of buyers and sellers. It is now trading at 15 percent below its initial offering.

Direct listings allow companies to decrease investment banking fees and avoid agreements that would otherwise prevent many current shareholders from selling stock.

Slack expects to pay $22.1 million in fees to its financial advisers for the listing, according to Reuters.

In comparison, Snap paid $85 million in commissions to banks for its 2017 IPO, which was worth about $31 billion at the time.

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Slack tries uncommon tactic to ensure successful IPO listing

As 2019’s bumper crop of initial public offerings either languishes or wildly exceeds expectations, Slack Technologies Inc. is taking a route to the trading floor that it hopes will yield a much more boring outcome.

Following in the footsteps of music-streaming service Spotify Technology SA last year, the workplace messaging application is set to start trading on the New York Stock Exchange Thursday via a direct listing. It’s just the second large company to test the unusual method and will be closely watched by other potential candidates to see how successfully the company and its advisers pull it off.

Investors got their first hint of how things are going when Slack’s reference price was set at $26 per share on Wednesday. Unlike the offering price paid by investors in a traditional IPO, the reference price doesn’t establish the valuation, though it’s partly based on recent trading in private markets. Its main purpose is to provide a starting point to allow trading to begin under New York Stock Exchange rules.

With IPO heavyweight advisers from Goldman Sachs Group Inc., Morgan Stanley and Allen & Co. helping to steer Slack through its listing alongside market maker Citadel Securities, all eyes will be on how the first day of trading plays out. But the company and its investors aren’t looking for a meaningful stock pop — and want to avoid the volatility — that often accompanies high-profile share sales, according to a person familiar with the process.

On Wednesday, Slack said that its investors had converted additional Class B stock to Class A shares, increasing the number that could be sold to 194 million from 181 million, out of a total of 504.4 million. Especially because there’s no lock-up period, there’s a risk of too few investors wanting to buy or too many wanting to sell.

“A direct listing can be considered risky for a variety of reasons,” Alejandro Ortiz, an analyst at SharesPost, said in a note. “There is an increased chance of substantially more supply than demand for Slack’s shares. All of this could result in heightened volatility in the early hours and days of trading.”

Reference Price

Fifteen months after its own direct listing, Spotify trades about 12% above its reference price of $132, at about $148 a share on Wednesday. That’s well below where the stock opened on its first day of trading in April 2018, though, at $165.90 apiece.

On Thursday, much of the attention at the exchange will be focused on one man. Pete Giacchi, a longtime market maker at the NYSE for Citadel Securities, will be tasked with opening the stock –- just as he was for Uber Technologies Inc.’s listing in May, people with knowledge of the matter said. It could be a long wait: Spotify’s shares took more than three hours to start trading, and it will take a while to make sure that the pricing and trading volumes coming in are at levels that Slack and its advisers are comfortable with.

Supply, Demand

Morgan Stanley, as the named adviser to the designated market maker, will be constantly trying to get a sense of supply and demand for the shares to advise on that opening price. The bank’s team includes global head of technology capital markets, Colin Stewart, as well as David Chen, who leads software banking. John Paci, the co-head of U.S. equities trading, will help advise the designated market maker on where the stock should open based on buying and selling interest gleaned from investors, according to people familiar with the details.

At Goldman Sachs, the work will be led by Nick Giovanni, co-head of the global technology, media and telecommunications group, equity capital markets head David Ludwig and Will Connolly, co-head of the West Coast financing group and head of technology ECM.

One thing Slack’s listing will have in common with an IPO: executives including Chief Executive Officer Stewart Butterfield and finance chief Allen Shim are expected to be pacing the floor of the NYSE for the open. They may not stick around all day, though. They will likely spend some time at the offices of their advisers before celebrating with employees and customers, according to a person with knowledge of the matter.

Representatives for Slack, Goldman Sachs, Morgan Stanley and Citadel Securities declined to comment.

Private Funds

Slack’s decision to bypass a traditional IPO — and the opportunity it brings to raise funds — is yet another sign of how benevolent private markets have been to tech startups in recent years. Slack’s earliest major investor, venture capital firm Accel, has directed a fire hose of money at the messaging company over the years, investing from several of its funds to accumulate a 23.8% stake.

In addition to Accel, Slack captured the imagination of elite investors such as Andreessen Horowitz and Social Capital. But it was SoftBank Group Corp.’s behemoth Vision Fund, which also owns stakes in Uber and WeWork Cos., that accelerated Slack’s fundraising when it led a $250 million investment in 2017.

One of the main reasons that Slack has remained well capitalized, however, is that it burns through less cash than some of SoftBank’s other investments. Uber, for instance, accumulated more than $10 billion in operating losses in three years. While Slack expects higher-than-usual losses in the second quarter, that still amounts to only about $75 million to $77 million for the three months, even including expenses related to the listing.

Growth vs. Profitability

The high demand for IPOs by the likes of money-losing companies including Uber, Lyft Inc. and Beyond Meat Inc. proves that investors remain focused on growth prospects over profitability –- in the short term at least.

With Uber leading the pack with its $8.1 billion offering, 79 companies have raised $28.88 billion in U.S. IPOs this year, according to data compiled by Bloomberg. That includes five other listings topping $1 billion, including the $2.34 billion IPO by Uber’s ride-hailing rival Lyft.

With no lock-up period for a direct listing, Slack investors could be jittery about any updates from the company, perceived competitive threats or other risks.

Tiny Speck

In its filings, Slack has warned investors that it’s a relatively new business, launching only in 2014 after existing for several years as a gaming company called Tiny Speck. Its rocket-ship ascent has attracted plenty of investors, but gives new potential shareholders only a limited trajectory to study.

Another challenge for Slack is one that fellow mega startups like Uber have grappled with, namely whether they can move beyond the core offering that their early years of success were built on. While Slack has improved its product so that it can serve larger companies, many customers still consider it an easy-to-use, aesthetically pleasing workplace messaging platform, despite speculation that it could evolve into a catch-all portal for business applications.

One thing that could make Slack’s debut more unpredictable than Spotify’s is its investor base. Because the company’s ownership is more concentrated among fewer, larger shareholders, it could be more difficult to gauge the supply of shares that are likely to be traded, one person with knowledge of the process said. Both buyers and sellers may also hang back on day one to see how trading goes before getting involved: Just 30 million of Spotify shares changed hands in its trading debut, less than a third of the total available.

Now read: Dell, HP, Intel and Microsoft join forces to fight Trump tariff

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Stoke Therapeutics Announces Pricing of Initial Public Offering

Stoke Therapeutics Announces Pricing of Initial Public Offering

Stoke Therapeutics, Inc., a biotechnology company that is pioneering a
new way to treat the underlying cause of genetic diseases by precisely
upregulating protein expression, todayannounced the pricing of its
initial public offering of 7,891,110 shares of its common stock at a
price to the public of $18.00 per share. All of the shares are being
offered by Stoke. The shares are expected to begin trading on The Nasdaq
Global Select Market on June 19, 2019 under the symbol “STOK.” The
offering is expected to close on June 21, 2019, subject to customary
closing conditions. The gross proceeds from the offering, before
deducting underwriting discounts and commissions and other offering
expenses payable by Stoke, are expected to be approximately $142.0
million. In addition, the underwriters have been granted a 30-day option
to purchase up to an additional 1,183,666 shares of common stock.

J.P. Morgan Securities LLC, Cowen and Company, LLC and Credit Suisse
Securities (USA) LLC are acting as joint book-running managers for the
offering. Canaccord Genuity LLC is acting as lead manager.

A registration statement relating to these securities has been filed
with the Securities and Exchange Commission and became effective on June
18, 2019. The offering is being made only by means of a prospectus. A
copy of the final prospectus relating to the offering, when available,
may be obtained from J.P. Morgan Securities LLC, c/o Broadridge
Financial Services, Attention: Prospectus Department, 1155 Long Island
Avenue, Edgewood, New York 11717, or by telephone: (866) 803-9204, or by
emailing prospectus-eq_fi@jpmchase.com;
from Cowen and Company, LLC c/o Broadridge Financial Solutions,
Attention: Prospectus Department, 1155 Long Island Avenue, Edgewood, New
York 11717, or by telephone: (631) 592-5973, or by emailing PostSaleManualRequests@broadridge.com;
or from Credit Suisse Securities (USA) LLC, Attention: Prospectus
Department, Eleven Madison Avenue, 3rd floor, New York, NY 10010, or by
telephone: (800) 221-1037, or by emailing usa.prospectus@credit-suisse.com.

This press release shall not constitute an offer to sell or the
solicitation of an offer to buy, nor shall there be any sale of these
securities in any state or jurisdiction in which such offer,
solicitation, or sale would be unlawful prior to registration or
qualification under the securities laws of any such state or
jurisdiction.

About Stoke TherapeuticsStoke Therapeutics is a
biotechnology company that is pioneering a new way to treat the
underlying causes of severe genetic diseases by precisely upregulating
protein expression to restore target proteins to near normal levels.
Stoke aims to develop the first precision medicine platform to target
the underlying cause of a broad spectrum of genetic diseases in which
the patient has one healthy copy of a gene and one mutated copy that
fails to produce a protein essential to health. These diseases, in which
loss of approximately 50 percent of normal protein expression causes
disease, are called autosomal dominant haploinsufficiencies. Stoke was
launched with investments by Apple Tree Partners. Stoke is headquartered
in Bedford, Massachusetts with offices in Cambridge, Massachusetts.

View source version on businesswire.com: https://www.businesswire.com/news/home/20190618006072/en/

SOURCE: Stoke Therapeutics, Inc.

Dawn KalmarVice President, Head of Corporate Affairsdkalmar@stoketherapeutics.com781-303-8302

Copyright Business Wire 2019

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