Sabre Corp. (NASDAQ:SABR), a provider of technology solutions for the travel and tourism industries, plans to raise $850.0 million in its upcoming IPO.
The Southlake, Texas-based firm will offer 44.7 million shares at an expected price range of $18-$20 per share. If the IPO can reach the midpoint of that range at $19 per share, SABR will command a market value of $4.9 billion.
Filing and Underwriting
SABR filed on January 21, 2014.
Lead Underwriters: BofA Merrill Lynch, Deutsche Bank Securities Inc, Goldman Sachs & Co, Morgan Stanley & Co LLC
Underwriters: Cowen and Company LP, Evercore Group LLC, Jefferies LLC, Mizuho Securities USA Inc, Natixis Securities Americas LLC, Sanford C. Bernstein and Co Inc, The Williams Capital Group LP, TPG Capital BD LLC, William Blair and Co LLC
A Comprehensive, Global Business
SABR is a leading provider of software and services to both suppliers and buyers in the global travel and tourism industries. The firm's travel marketplace connects buyers with airlines, rail carriers, hotels, cruise lines, care rental firms, and many other services. SABR distributes content from some 125,000 travel suppliers to travel agents, and provides those agents with a platform to price and book travel options.
The firm provides software solutions for everything from reserving flights and hotels to planning aircraft crew schedules. SABR is among the largest global distribution systems (GDS) providers in the world, and the number one GDS provider in North America. SABR also operates the popular Travelocity booking website.
SABR offers the following figures in its S-1 balance sheet for the year ended December 31, 2013:
Net Loss: ($97,631,000.00)
Total Assets: $4,755,708,000.00
Total Liabilities: $5,073,401,000.00
Stockholders' Equity: ($952,536,000.00)
Competitors From Several Angles
SABR's diversity of services means that the firm faces different competitors in different facets of its business. Some of the firm's competitors include Amadeus, Hewlett-Packard (NYSE:HPQ), Unisys (NYSE:UIS), Accenture (NYSE:ACN), Boeing (NYSE:BA), Lufthansa, ITA Software, Datalex, Priceline (NASDAQ:PCLN), and Travelport.
Thomas Klein has served as SABR's President and CEO since August 2013, and served as company president from January 2010. He served in various other roles with SABR before becoming president, including executive vice president, Sabre, and group president of the firm's Travel Network and Airline and Hospitality Solutions businesses.
He previously served in marketing and operations positions at American Airlines and Consolidated Freightways Inc.
Mr. Klein received a bachelor's degree in business administration from Villanova University.
Conclusion For Investors
We are neutral to positive on this IPO. Investors should consider this large IPO if it prices at the lower end of the range or lower.
Though SABR is losing money, its losses have decreased over the past several years, and the firm seems to be approaching profitability.
Like other travel-oriented companies, SABR was hit hard by the Great Recession, and should recover with the economy.
The firm has a highly impressive GDS market share, especially in the Americas, and is equipped with a strong leadership team. SABR also has a very strong list of underwriters.
Disclosure: I have no positions in any stocks mentioned, but may initiate a long position in SABR over the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.