AMC Entertainment (NYSE:AMC) contributed to 2013's 13-year record for US IPO activity with a $332 million deal this week. The country's second-largest movie chain priced at the low end of the range and traded up 8% by Thursday. With an empty IPO calendar, 2013 will end with 222 IPOs and $55 billion raised, both representing post-2000 highs. Four companies, including two E&Ps, submitted their initial IPO filings this week.
Modest opening-day pop for AMC
In a tepid end to a hot year for consumer IPOs (average first-day gain of 37%), AMC Entertainment rose 5% on its first day of trading on Wednesday. Facing flattening box office attendance, AMC has centered its attention on creating a luxury movie-watching experience. The chain has installed electric recliners with leg rests at 28 theaters, begun seat-side dining service at 11 locations and opened its MacGuffins Bar & Lounges at 45 more. Acquired by China's Wanda Group in August 2012 for $2.6 billion, AMC will use the IPO proceeds to expand these upscale offerings and pay down debt.
|IPO pricings (week of December 16, 2013)|
|Company (Ticker)||Business||Deal Size ($mm)||IPO Price vs. Midpoint||Return as of 12/20|
|AMC Entertainment (AMC)||Movie theater chain||$332||-5%||8%|
Oil and gas E&P Rice Energy files for an $800 million IPO
As of early Friday afternoon, four companies had submitted initial IPO filings this week. The largest deals came from two E&Ps, Rice Energy ((NYSE:RICE)) and Sundance Energy Australia ((Pending:SNDE)), which are looking to raise $800 million and $175 million, respectively. Rice Energy is backed by Natural Gas Partners and has 552 Bcf of pro forma proved reserves in southwestern Pennsylvania. Sundance Energy Australia, which trades on the Australian Securities Exchange, owns 191,251 gross acres with average daily net production of 3,855 Boe/d in Texas, Oklahoma, Colorado and North Dakota.
Filings for smaller deals were submitted by Transport America (TRAM), a provider of truckload transportation and logistics to shippers in the US and Mexico, and Retrophin (NASDAQ:RTRX), which is listed on the OCTQB. Transport America, backed by private equity firm Goldner Hawn Johnson & Morrison, has a fleet of 1,500 tractors and 4,400 trailers. Retrophin is seeking FDA marketing approval for an oxytocin nasal spray that it is licensing from Novartis (NYSE:NVS). The spray, a treatment for milk let-down, was withdrawn from sale in the US in 1997 for commercial reasons.
|New IPO filers (week of December 16, 2013)|
|Company (Ticker)||Business||Deal Size ($mm)||LTM Sales ($mm)|
|Rice Energy (RICE)||Natural gas E&P||$800||$72|
|Sundance Energy Australia (SNDE)||Oil and gas E&P||$175||$67|
|Transport America (TRAM)||Shipping logistics||$75||$353|
|Retrophin (RTRX)||Oxytocin nasal spray||$40||$0|
IPO market snapshot
The 222 IPOs in 2013 have raised $54.9 billion and produced an average return of 34%. The Renaissance IPO ETF, which trades under the symbol IPO, tracks an index that is up 50% this year. There have been 82 IPOs in the past 90 days, with total proceeds of $25.0 billion and an average return of 36%. The active IPO pipeline includes 87 companies looking to raise a total of $23.5 billion.