Stage Set for Busy IPO Week

by: Renaissance Capital IPO Research

This week's US IPO market saw two companies successfully complete their deals, setting the stage for nine others that are expected to follow next week. If all nine IPOs are priced, it will be the busiest week for US IPOs in nearly three years (since December 2007).

CoreSite Realty (NYSE:COR), a data center REIT backed by private equity firm Carlyle Group, raised $270 million on Wednesday by offering 16.9 million shares at its $16 midpoint. CoreSite Realty, which has over 600 customers and a portfolio of 11 data centers, saw its stock rise modestly by the end of the week. REIT activity has picked up in the IPO market recently with CoreSite being only one of three to disclose terms so far this month, along with Campus Crest Communities (NYSE:CCG) and US Federal Properties Trust (USFP).

SciQuest (NASDAQ:SQI), which provides on-demand procurement and supplier management software, raised $57 million on Thursday by offering 6 million shares at $9.50, at the low end of its proposed range of $9.50-$11.50. The stock climbed more than 30% in early trading on Friday. SciQuest had previously gone public in 1999 before venture firm Trinity Ventures took it private in 2004. The company's strong track record coupled with technical tailwinds in the software as a service space were likely to have contributed to its successful second debut.

There are nine deals scheduled on the IPO calendar for next week, which cover a wide range of industries and include property and casualty insurer Liberty Mutual (LMAC) and defense contractor KEYW Holding (NASDAQ:KEYW). Three of the nine are China-based IPOs (fast food restaurant chain Country Style Cooking (NYSE:CCSC), Internet content provider ChinaCache International (NASDAQ:CCIH) and wind turbine manufacturer China Ming Yang Wind Power (NYSE:MY)), which have been prevalent in recent months. Another notable trend is the growing interest in alternative energy and energy conservation, with biofuels company Amyris Biotechnologies (NASDAQ:AMRS) and traditional and smart meter provider Elster Group (ELT) also expected to list next week. The growing IPO pipeline for the US market stands at over $57 billion and suggests high levels of IPO activity will be sustained in the coming months.

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