This Week's IPOs: CastlePoint Holdings, Cheniere Energy Partners, Glu Mobile, Haynes International

by: Abbi Adest

IPOs on deck for this week include: CastlePoint Holdings (CPHL), a property, casualty insurance and reinsurance company; Cheniere Energy Partners (NYSEMKT:CQP), a natural gas development company; Glu Mobile (NASDAQ:GLUU), a mobile game publisher; and Haynes International (NASDAQ:HAYN) a high-performance alloy manufacturing company.

All quotations are from the companies' most recent S-1 filings with links provided for each company.

Business Overview (from prospectus)

We are a Bermuda holding company organized to provide property and casualty insurance and reinsurance business solutions, products and services primarily to small insurance companies and program underwriting agents in the United States. We were incorporated in November 2005 to take advantage of opportunities that we believe exist in the insurance and reinsurance industry for traditional quota share reinsurance, insurance risk-sharing and program business as well as insurance company services that can be purchased on a stand-alone, or unbundled basis, to small insurance companies and program underwriting agents.

Offering: 6.1 million shares at $13.00-15.00 per share. Net proceeds of approximately $76.5 million will be used to "further capitalize CastlePoint Re, and for general corporate purposes. We will not receive any of the proceeds from the sale of common shares by the selling shareholders."

Lead Underwriters: Friedman Billings, Cochran Caronia

Financial Highlights:

Total revenues were $92.5 million in 2006, which consisted of net premiums earned (85.4% of the total revenues), commission income (2.5% of the total revenues) and net investment income (12.1% of the total revenues)... Our net income was $10.5 million in 2006. The net income increased each quarter throughout 2006 primarily as a result of increasing underwriting and investment leverage throughout the year. Our average return on equity was 5.1% for the year ended December 31, 2006. The return was calculated by dividing net income of $10.5 million by weighted average shareholders' equity of $207.3 million. Our return on equity increased by quarter in line with our increase in net income and was 9.8% for the three months ended December 31, 2006... Gross and net written premiums were $165.2 million in 2006. Included in the gross and net written premiums of $165.2 million was $40.9 million of written premiums from Tower representing 30% of Tower's unearned premiums for the brokerage business as of March 31, 2006. The total amount of written premiums assumed from Tower by CastlePoint Re in 2006 was $157.7 million, which represented 94.1% of our gross written premiums in 2006. Tower's business represented 96.2% of net premiums earned in 2006


Business Overview (from prospectus)

We are a Delaware limited partnership recently formed by Cheniere Energy, Inc. Through our wholly-owned subsidiary, Sabine Pass LNG, we will develop, own and operate the Sabine Pass LNG receiving terminal currently under construction in western Cameron Parish, Louisiana on the Sabine Pass Channel.

Construction of the Sabine Pass LNG receiving terminal began in March 2005. Upon completion of construction, the Sabine Pass LNG receiving terminal will be the largest LNG receiving terminal in North America with approximately 4.0 billion cubic feet per day, or Bcf/d, of regasification capacity and approximately 16.8 Bcf of LNG storage capacity. All of this capacity has been contracted for under three 20-year, firm commitment terminal use agreements, or TUAs. Each customer must make payments on a “take-or-pay” basis, which means that the customer will be obligated to pay the full contracted amount of monthly fees whether or not it uses any of its reserved capacity.

Offering: 12.5 million shares at $19.00-21.00 per share. Net proceeds of approximately $96.9 million will be used "to purchase U.S. treasury securities maturing as to principal and interest at such times and in such amounts as will be sufficient to pay the $0.425 initial quarterly distribution on all common units, as well as related distributions to our general partner, through the distribution made in respect of the quarter ending June 30, 2009. These U.S. treasury securities will be held as a distribution reserve under our partnership agreement. "

Lead Underwriters: Citigroup, Merrill Lynch, Credit Suisse

Financial Highlights:

Our financial results for the year ended December 31, 2006 reflected a net loss of $60.8 million, compared to a net loss of $4.3 million in 2005...Total expenses increased $5.6 million, or 119.1%, to $10.3 million in 2006 compared to $4.7 million in 2005...Total other expense, net of interest income, for the year ended December 31, 2006 was $50.5 million compared to other income of $0.5 million in 2005.


Business Overview (from prospectus)

Glu Mobile is a leading global publisher of mobile games. We have developed and published a portfolio of more than 100 casual and traditional games to appeal to a broad cross section of the over one billion subscribers served by our more than 150 wireless carriers and other distributors. We create games and related applications based on third-party licensed brands and other intellectual property, as well as on our own original brands and intellectual property. Our games based on licensed intellectual property include Deer Hunter, Diner Dash, Monopoly, Sonic the Hedgehog, World Series of Poker and Zuma. Our original games based on our own intellectual property include Alpha Wing, Ancient Empires, Blackjack Hustler, Brain Genius, Stranded and Super K.O. Boxing. We were one of the top three mobile game publishers during the fourth quarter of 2006 in terms of mobile game market share in North America, as measured by NPD Group, Inc., a market research firm, in its December 2006 “Mobile Game Track Highlight Report,” and in terms of unit sales volume in North America and Europe among titles tracked by m:metrics, another market research firm.

Offering: 7.3 million $10.00-12.00 per share. Net proceeds of approximately $71.7 million will be used to expand global sales and marketing activities; expand international development and quality assurance activities in Latin America, Asia Pacific and the EMEA regions; activities to increase carrier and distribution channels; possible future acquisitions.

Lead Underwriters: Goldman Sachs, Banc of America

Financial Highlights:

Our revenues increased $20.5 million, or 80.0%, from $25.7 million in 2005 to $46.2 million in 2006...Our cost of revenues increased $3.0 million, or 23.5%, from $12.8 million in 2005 to $15.8 million in 2006...Our gross margin increased from 50.0% in 2005 to 65.7% in 2006 because of the decreased amortization of intangible assets and the decreased impairment of prepaid royalties and intangible assets in 2006 partially offset by the increase in royalties.

Business Overview (from prospectus)

Haynes International, Inc. is one of the world’s largest producers of high-performance nickel- and cobalt-based alloys. We are focused on developing, manufacturing, marketing and distributing technologically advanced, high-performance alloys, which are used primarily in the aerospace, chemical processing and land-based gas turbine industries. Our products consist of high temperature resistant alloys, or HTA products, and corrosion resistant alloys, or CRA products. HTA products are used by manufacturers of equipment that is subjected to extremely high temperatures, such as jet engines for the aerospace industry, gas turbine engines used for power generation and waste incineration, and industrial heating equipment. CRA products are used in applications that require resistance to corrosive environments found in chemical processing, power plant emissions control and hazardous waste treatment. We believe we are one of four principal producers of high-performance alloys in sheet, coil and plate forms, and sales of these forms, in the aggregate, represented approximately 64% of our net revenues in fiscal 2006. We also produce our products as seamless and welded tubulars, and in bar, billet and wire forms.

Offering: 2.1 million shares at $61.00-64.00 per share. Net proceeds of approximately $64.0 million will be used to repay outstanding debt and for strategic investments in the company's manufacturing facilities.

Lead Underwriters: J.P. Morgan, KeyBanc Capital

Financial Highlights:

Net revenues increased by $26.1 million, or 27.6%, to $120.5 million in the first quarter of fiscal 2007 from $94.4 million in the same period of fiscal 2006. Volume for all products increased by 7.8% to 5.5 million pounds in the first quarter of fiscal 2007 from 5.1 million pounds in the same period of fiscal 2006...Cost of sales as a percentage of net revenues decreased to 72.1% in the first quarter of fiscal 2007 from 81.7% in the same period of fiscal 2006... [O]perating income in the first quarter of fiscal 2007 was $23.5 million compared to $7.3 million in the same period of fiscal 2006...[N]et income increased by $9.9 million to $13.2 million in the first quarter of fiscal 2007 from $3.3 million in the same period of fiscal 2006.