U.S. IPO Week Ahead: Goldman LBO Leads The Way

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Includes: LN, PBNC, PSAV, VIVE
by: Renaissance Capital IPO Research

The week ahead will see three IPOs, led by Goldman LBO PSAV which will be accompanied by two smaller deals that are already OTC listed. IPO activity is still sluggish, but the gradual increase in trailing 90 day IPO returns over the past month (from 5.6% to 13%) and IPO index outperformance over the past month (+2% vs. S&P +1.6%) may help increase the number of deals in the coming weeks.

Renaissance Capital's IPO Calendar - Week of 6/13/2016
Issuer
Business
Symbol
Exchange
Deal Size
$mil
Price Range
Shares Filed
Lead Manager(s)
PSAV
Schiller Park, IL
PSAV
NYSE
$250 $14 - $17
16,129,032
Goldman Sachs
Morgan Stanley
Leading provider of audiovisual equipment rental and support services for events.
Paragon Commercial
Raleigh, NC
PBNC
Nasdaq
$25 $33 - $35
736,000
Raymond James
North Carolina commercial bank with $1.3 billion in assets.
Viveve Medical
Sunnyvale, CA
VIVE
Nasdaq
$13 $8
1,562,500
Ladenburg Thalmann
Craig-Hallum Capital
Commercializing a non-invasive medical system that reverses vaginal laxity.
Click to enlarge

PSAV (Pending:PSAV) - After a merger with the number two industry player in 2012, PSAV was acquired by Goldman and Olympus Partners in 2014. It is the leading provider of audiovisual services for events held in luxury and upper upscale hotels in the US (46% market share), securing attractive long-term contracts with four of the five largest hotel chains. The company grew sales by 18% in fiscal 2015 to $1.5 billion, though it will need to improve its operating leverage in order to manage its debt leverage.

Paragon Commercial (OTCQX:PBNC) - Currently listed on the OTCQX market under symbol PBNC, this bank operates three branches all in North Carolina. It does traditional community banking with $1 billion in loans and focuses on high net-worth individuals and businesses with annual revenues of $5 to $75 million.

Viveve Medical (Pending:VIVE) - Currently listed on the OTCQB market under symbol VIVMF, this medical device company has regulatory clearance to sell its systems, costing approximately $38,000 each, in 22 countries. It plans to begin the approval process in the US this year.

Looking further out, Japanese mobile messaging application Line (NASDAQ:LN) is on the calendar and is set to be the largest US tech IPO since 2014.

IPO Market Snapshot
The Renaissance IPO Indices are market cap weighted baskets of newly public companies. The Renaissance IPO Index is down 6% year-to-date, while the S&P 500 is up 3%. Renaissance Capital's IPO ETF (NYSE: IPO) tracks the index, and top ETF holdings include Alibaba (NYSE:BABA), Synchrony Financial (NYSE:SYF) and Citizens Financial Group (NYSE:CFG). The Renaissance International IPO Index is down 3% year-to-date, compared to -0.1% for ACWX. Renaissance Capital's International IPO ETF (NYSE: IPOS) tracks the index, and top ETF holdings include NN Group and Aena S.A.