U.S. IPO Weekly Recap: Semiconductors And Energy Storage Lead A Spooky 14 IPO Week

Summary

  • The IPO market remained active this past week as 13 IPOs raised $6.3 billion. SPAC activity kept steady with 13 blank check IPOs raising $2.1 billion.
  • New filers continued to pour into the IPO pipeline, with eight IPOs and seven SPACs submitting initial filings.
  • Semiconductor foundry GlobalFoundries priced at the high end to raise $2.6 billion at a $26 billion market cap.

Photo on IPO (initial public offering) theme. The abbreviation "IPO" on a colorful background. Business concept image

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The IPO market remained active this past week as 13 IPOs raised $6.3 billion. SPAC activity kept steady with 13 blank check IPOs raising $2.1 billion. New filers continued to pour into the IPO pipeline, with eight IPOs and seven SPACs submitting initial filings.

Semiconductor foundry GlobalFoundries (GFS) priced at the high end to raise $2.6 billion at a $26 billion market cap. Backed by Abu Dhabi’s Mubadala, US-based GlobalFoundries is one of the world’s leading specialty semiconductor foundries. Unprofitable with lumpy growth, the company states that it is the only scaled pure-play foundry with a global footprint that is not based in China or Taiwan. GlobalFoundries finished up 4%.

Energy storage provider Fluence Energy (FLNC) priced well above the range to raise $868 million at a $4.7 billion market cap. Formed as a JV between industrial conglomerate Siemens (OTCPK:SIEGY) and power distributor AES (AES), this company provides energy storage products to utilities, power producers, and commercial and industrial customers. Fast growing but unprofitable, the company generated about 90% of revenue in FY20 from five customers. Fluence Energy finished up 27%.

Enterprise cloud data management platform Informatica (INFA) priced at the low end to raise $841 million at a $8.3 billion market cap. Taken private by Permira and CPP Investments for $5.3 billion in 2015, Informatica offers a leading enterprise data management platform for large enterprise. Although it will be highly leveraged post-IPO, Informatica is a recognized leader in the global data management market and saw strong subscription ARR growth in the 1H21. Informatica finished up 2%.

Hiring solutions provider HireRight Holdings (HRT) priced below the range to raise $422 million at a $1.5 billion market cap. Backed by General Atlantic and Stone Point, this company is one of the leading US providers of background checks for corporate customers. Although revenue fell due to COVID, HireRight operates in a multibillion market benefiting from secular trends. HireRight finished down 9%.

Online education marketplace Udemy (UDMY) priced at the high end to raise $421 million at a $4.4 billion market cap. Backed by Insight Partners, Udemy operates an online learning marketplace with over 183,000 courses serving 44 million free and paid learners and 8,700 enterprise customers. Fast growing but unprofitable, the company operates in the crowded online learning market. Udemy finished down 5%.

Designer fashion rental platform Rent the Runway (RENT) upsized and priced at the high end to raise $357 million at a $1.5 billion market cap. This apparel rental company originally focused on a-la-carte rentals of dresses for events, but has gradually transitioned to mostly generating revenue from monthly subscription boxes. While the company has seen active subscribers and revenue rebound in the last two quarters, it is unprofitable and leveraged post-IPO. Rent the Runway finished down 18%.

Fire pit brand Solo Brands (DTC) priced at the high end to raise $219 million at a $1.6 billion market cap. Solo Brands sells fire pits, camp stoves, and other outdoor gear through its DTC platform. Fast growing and profitable, this outdoor e-commerce has an installed base of more than 2.3 million customers. Solo Brands finished up 8%.

Rare disease biotech Entrada Therapeutics (TRDA) upsized and priced at the midpoint to raise $182 million at a $637 million market cap. The company is initially focused on developing Endosomal Escape Vehicle therapeutics for rare neuromuscular diseases. Its most advanced candidate, ENTR-601-44, is being developed for patients with Duchenne muscular dystrophy that are exon 44 skipping amenable. Entrada plans to submit an IND application for ENTR-601-44 in 2022. Entrada Therapeutics finished up 20%.

Root canal therapy system maker Sonendo (SONX) priced well below the range to raise $94 million at a $340 million market cap. Sonendo has developed what it states is the first and only FDA-cleared system for root canal therapy (RCT), called the GentleWave System. Sonendo began scaling commercialization of its current technology in 2017, and as of June 30, 2021, it had an installed base of over 700 GentleWave Systems and has treated more than 600,000 patients. Sonendo finished down 23%.

Body contouring provider AirSculpt Technologies (AIRS) priced at the low end to raise $77 million at a $612 million market cap. This company provides minimally-invasive body contouring procedures through 16 centers across 13 states in the US. AirSculpt Technologies is profitable with solid growth, and has seen an increase in same-center case volume as a result of lessening effects of COVID-19. AirSculpt Technologies finished up 45%.

Solid tumor biotech Aura Biosciences (AURA) upsized and priced at the low end to raise $76 million at a $428 million market cap. AU-011, its first Virus-Like Drug Conjugate candidate, is being developed for the first line treatment of primary choroidal melanoma, a rare disease with no drugs approved. Aura plans to present six to twelve-month safety and efficacy data from its Phase 2 dose escalation trial in 2022, and, if favorable, initiate a pivotal trial in the 2H22. Aura Biosciences finished up 6%.

Technology firm Arteris (AIP) priced at the low end to raise $70 million at a $518 million market cap. This technology company develops and licenses interconnect intellectual property that manages the on-chip communications in System-on-Chip semiconductor devices. Arteris is unprofitable but saw growth accelerate in the 1H21. Arteris finished up 60%.

Documentation software provider Augmedix (AUGX) priced its uplisting at $4 to raise $40 million at a $167 million market cap. Delivering over 35,000 notes to our customers each week, Augmedix provides remote documentation software to the healthcare industry. The company is growing but unprofitable with negative cash flow. Augmedix finished down 6%.

Micro-cap managed health platform Marpai (MRAI) priced below the range to raise $25 million at a $76 million market cap. Marpai provides and manages a health plan platform for self-insured employers that pay for their employees’ healthcare benefits. Growing but highly unprofitable, this health plan platform uses AI to predict costly events to optimize employee care and employer savings. Marpai finished up 40%.

13 blank check companies raised $2.1 billion this past week led by industrial tech-focused Perception Capital II (PCCTU), which raised $200 million.

27 IPOs During the Week of October 25th, 2021

Issuer

Business

Deal Size

Market Cap at IPO

Price vs. Midpoint First Day Return Return at 10/29
Arteris (AIP) $70M $518M -7% +30% +60%
Develops and licenses interconnect IP for semiconductor SoCs.
AirSculpt Technologies (AIRS) $77M $612M -31% +44% +44%
Provides minimally-invasive body contouring procedures in the US.
Marpai (MRAI) $25M $76M -56% +19% +40%
Managed health plan platform for self-insured employers.
Fluence Energy (FLNC) $868M $4,667M 24% +25% +27%
Energy storage products and services provider formed by Siemens and AES.
Entrada Therapeutics (TRDA) $182M $637M 0% +20% +20%
Preclinical biotech developing therapies for rare neuromuscular diseases.
Solo Brands (DTC) $219M $1,623M 10% +4% +8%
Sells branded smokeless fire pits and other outdoor gear.
Aura Biosciences (AURA) $76M $428M -7% +6% +6%
Phase 2 biotech developing virus-like drug conjugates for ocular and urologic solid tumors.
GlobalFoundries (GFS) $2,585M $25,967M 6% -1% +4%
Global semiconductor designer and foundry based in the US.
Informatica (INFA) $841M $8,277M -5% +0% +2%
Provides an enterprise cloud data management platform.
LAVA Medtech Acquisition (LVACU) $100M $125M 0% +1% +1%
Blank check company targeting the medtech sector.
Pyrophyte Acquisition (PHYT.U) $175M $219M 0% +1% +1%
Blank check company targeting the energy transition ecosystem.
ARC Bioholdings I (ARCKU) $150M $188M 0% +1% +1%
Blank check company backed by Rapha Capital Management and RNA Capital Advisors targeting biopharmas.
Innovative Intl. Acq. (IOACU) $200M $280M 0% +1% +1%
Blank check company formed by Mohan Ananda and the CEO of Frientap.
Perception Capital II (PCCTU) $200M $250M 0% +1% +1%
Blank check company formed by Perception Capital targeting industrial technology.
Deep Medicine Acquisition (DMAQU) $110M $143M 0% +1% +1%
Blank check company targeting the healthcare industry.
AltEnergy Acquisition (AEAEU) $200M $250M 0% +1% +1%
Blank check company formed by AltEnergy LLC targeting the alternative energy sector.
Anthemis Digital Acq. I (ADALU) $200M $272M 0% +1% +1%
Blank check company formed by Anthemis Group targeting financial technology.
Cactus Acquisition 1 (CCTSU) $110M $138M 0% +0% +0%
Blank check company targeting tech-based healthcare businesses in or connected to Israel.
SCM Acquisition (SCMAU) $130M $163M 0% +0% +0%
Blank check company formed by SGAM and Calibre Group targeting the steel, metals, and metal processing sector.
SDCL EDGE Acquisition (SEDA.U) $175M $219M 0% n/a +0%
Blank check company formed by Sustainable Development Capital targeting energy efficiency plays.
OPY Acquisition I (OHAAU) $110M $135M 0% -1% +0%
Blank check company formed by Oppenheimer targeting healthcare.
PER Acquisition (PEGRU) $250M $313M 0% -1% -1%
Blank check company targeting the "Electric Grid 2.0".
Udemy (UDMY) $421M $4,442M 4% -5% -5%
Online education marketplace offering user-generated courses.
Augmedix (AUGX) $40M $167M -33% -13% -6%
Provides remote documentation software to the healthcare industry.
HireRight (HRT) $422M $1,519M -16% -9% -9%
Provides tech-enabled background screening and identity verification services.
Rent the Runway (RENT) $357M $1,504M 8% -8% -18%
Rents designer apparel and accessories to women via monthly subscriptions.
Sonendo (SONX) $94M $340M -25% -23% -23%
Makes a medical device system for less-invasive root canal therapy.

8 IPOs submitted initial filings this past week. Cannabis finance REIT Chicago Atlantic Real Estate Finance (REFI) filed to raise $129 million. Bitcoin miner Rhodium Enterprises (RHDM), Australian Bitcoin miner Iris Energy (IREN), and restaurant chain Sweetgreen (SG) all filed to raise $100 million. Genetic testing provider Agendia (AGDX) filed to raise $75 million. Scottish biotech TC BioPharm Holdings (TCBP) filed to raise $50 million. Solid tumor biotech Intensity Therapeutics (INTS) filed to raise $17 million. Online home goods retailer Hour Loop (HOUR) filed to raise $6 million.

Seven SPACs submitted initial filings, led by tech and cybersecurity-focused ShoulderUP Technology Acquisition (SUAC.U), which filed to raise $250 million.

15 Filings During the Week of October 25th, 2021

Issuer

Business

Deal Size Sector Lead Underwriter
Rhodium Enterprises (RHDM) $100M Technology B. Riley
Fully integrated bitcoin miner with a planned 100 megawatt capacity.
Agendia (AGDX) $75M Health Care Goldman
Provides genetic tests designed to guide optimal treatments for breast cancer.
Hour Loop (HOUR) $6M Consumer Discretionary EF Hutton
Online retailer selling various household goods primarily on Amazon.
Intensity Therapeutics (INTS) $17M Health Care A.G.P.
Phase 1 biotech developing intratumoral injections treatments for cancer.
LF Capital Acquisition II (LFACU) $225M SPAC Jefferies
Second blank check company led by the former CSO of Candriam and former CEO of BNP Paribas targeting fintech.
Capitalworks EM Acq. (CMCAU) $200M SPAC Barclays
Blank check company targeting emerging market businesses.
Chicago Atlantic REF (REFI) $129M Financials JMP
Newly-formed commercial mortgage REIT focused on the cannabis industry.
Namaste World Acquisition (NWACU) $200M SPAC EF Hutton
Blank check company targeting the TMT and tech-enabled consumer sectors.
ShoulderUP Tech Acq. (SUAC.U) $250M SPAC Citi
Blank check company led by industry veterans targeting tech and cybersecurity.
TC BioPharm (TCBP) $50M Health Care EF Hutton
Scottish Phase 2 biotech developing allogeneic gamma-delta T cell therapies.
Iris Energy (IREN) $100M Technology JPMorgan
Bitcoin miner primarily powered by renewable energy.
Jaguar Global Growth I (JGGCU) $200M SPAC Citi
Blank check company formed by Jaguar Growth Partners and Hennessy Capital Group.
RCF Acquisition (RCF.U) $200M SPAC Citi
Blank check company formed by Resource Capital Funds targeting the critical minerals value chain.
Sunfire Acquisition (SUNFU) $100M SPAC EF Hutton
Blank check company formed by GLD Partners targeting the TMT sector.
Sweetgreen (SG) $100M Consumer Discretionary Goldman
Operates a chain of fast casual salad restaurants.

IPO Market Snapshot

The Renaissance IPO Indices are market cap weighted baskets of newly public companies. As of 10/28/2021, the Renaissance IPO Index was up 6.5% year-to-date, while the S&P 500 was up 22.4%. Renaissance Capital's IPO ETF (NYSE: IPO) tracks the index, and top ETF holdings include Moderna (MRNA) and Uber Technologies (UBER). The Renaissance International IPO Index was down 18.8% year-to-date, while the ACWX was up 9.7%. Renaissance Capital’s International IPO ETF (NYSE: IPOS) tracks the index, and top ETF holdings include Meituan-Dianping (MEIT) and SoftBank Corp (OTCPK:SFTBF) (OTCPK:SFTBY).

Original Post

Editor's Note: The summary bullets for this article were chosen by Seeking Alpha editors.

This article was written by

Renaissance Capital provides pre-IPO research to institutional investors and investment banks. The Firm manages two IPO-focused funds: The Renaissance IPO ETF (NYSE: IPO) and the Renaissance International IPO ETF (NYSE: IPOS). Individual investors can get a free overview of the IPO market on www.renaissancecapital.com, and try a free trial of our premium platform, IPO Pro (ipopro.renaissancecapital.com). Through Renaissance Capital’s pre-IPO research service, institutional investors get an independent opinion, in-depth fundamental analysis, and customizable financial models on all IPOs.

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