U.S. IPO Weekly Recap: Energy Play ProFrac Leads A 3 IPO Week

May 14, 2022 3:15 AM ETASNS, CRBG, GBBKU, HNVR, IREN, IVCAU, KLC, MCACU, NU, PFHC, PNACU, RIVN, SG, STWY, SVV

Summary

  • Three IPOs raised $330 million this past week, led by energy play ProFrac Holding, which delayed its pricing by a day.
  • The fracking services provider was joined by a bank and an IoT networking solutions micro-cap, as well as four SPACs.
  • No IPOs are currently scheduled to price in the week ahead, although a few SPACs may join the calendar during the week.

Initial public offering hologram, night panoramic city view of Bangkok. The financial center for multinational corporations in Asia. The concept of boosting the growth by IPO process. Double exposure.

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Three IPOs raised $330 million this past week, led by energy play ProFrac Holding (PFHC), which delayed its pricing by a day. The fracking services provider was joined by a bank and an IoT networking solutions micro-cap, as well as four SPACs.

ProFrac priced well below the range to raise $288 million at a $2.5 billion market cap. Operating in the solidly-performing energy sector, ProFrac believes it is the largest privately owned provider of hydraulic fracturing services in North America by hydraulic horsepower. There are several related party transactions and connections with the founding Wilks family, who indicated on 41% of shares in the offering. ProFrac finished up 1%.

New York bank Hanover Bancorp (HNVR) downsized slightly and priced at the low end to raise $27 million at a $153 million market cap. Hanover primarily serves small and medium-sized customers through eight branches, concentrated in the NYC area.

As of 12/31/21, the bank had total assets of $1.5 billion, total deposits of $1.2 billion, and total stockholders' equity of $129 million. Hanover finished up 3%.

Actelis Networks (ASNS), which provides hybrid fiber-copper equipment solutions to telecom and IoT networks, priced at the low end to raise $15 million at a $69 million market cap. The micro-cap finished down 40%.

Four SPACs also priced, led by Investcorp India Acquisition (IVCAU), which raised $225 million to target opportunities in India. The SPAC market has continued to crumble in 2022, with terminations on the rise amid poor de-SPAC trading. Withdrawals are also expected to continue as underwriters retreat from the space due to changing regulations.

7 IPOs During the Week of May 9th, 2022

Issuer

Business

Deal

Size

Market

Cap

at IPO

Price vs.

Midpoint

First

Day

Return

Return

at

05/13

Hanover Bancorp (HNVR) $27M $153M -5% +0% +3%
Community bank with eight branches in New York and New Jersey.
ProFrac (PFHC) $288M $2,524M -20% +1% +1%
Provides hydraulic fracturing and completion services to upstream E&Ps in North America.
Investcorp India Acq. (IVCAU) $225M $281M 0% +0% +0%
Blank check company formed by Investcorp Group targeting businesses in India.
Monterey Capital Acq. (MCACU) $80M $101M 0% n/a +0%
Blank check company targeting the clean energy transition space.
Global Blockchain Acq. (GBBKU) $150M $191M 0% +0% +0%
Blank check company led by execs at Global Blockchain Ventures targeting blockchain tech firms.
Prime Number Acquisition (PNACU) $60M $79M 0% -1% -1%
Blank check company formed by Dongfeng Wang targeting tech-enabled financial companies.
Actelis Networks (ASNS) $15M $69M -20% -40% -40%
Provides hybrid fiber-copper equipment solutions to telecom and IoT networks.
2 Filings During the Week of May 9th, 2022

Issuer

Business

Deal

Size

Sector

Lead

Underwriter

Metaverse Acquisition (METAU.RC) $150M SPAC I-Bankers
Blank check company targeting the metaverse arena in North America, Europe, and Asia.
CE Energy Acquisition (CEACU) $100M SPAC Maxim
Blank check company targeting the energy industry in the Americas.

Week Ahead

No IPOs are currently scheduled to price in the week ahead, although a few SPACs may join the calendar during the week.

Although the calendar is quiet, several large issuers have kept the pipeline active, including piano maker Steinway Musical Instruments Holdings (STWY), childcare provider KinderCare (KLC), thrift store chain Savers Value Village (SVV), and AIG carve-out Corebridge Financial (CRBG).

Lock-up periods will be expiring for some of the last names of the 2021 class of IPOs, including billion-dollar issuer Nu Holdings (NU), restaurant chain Sweetgreen (SG), and bitcoin miner Iris Energy (IREN). Investors will likely watch trading closely: The largest IPO of 2021, Rivian (RIVN) traded down more than 20% on Monday following its lock-up expiration.

IPO Market Snapshot

The Renaissance IPO Indices are market cap weighted baskets of newly public companies. As of 5/12/2022, the Renaissance IPO Index was down 50.8% year-to-date, while the S&P 500 was down 17.1%.

Renaissance Capital's IPO ETF (IPO) tracks the index, and top ETF holdings include Uber Technologies (UBER) and Snowflake (SNOW). The Renaissance International IPO Index was down 35.1% year-to-date, while the ACWX was down 17.0%. Renaissance Capital’s International IPO ETF (IPOS) tracks the index, and top ETF holdings include Volvo Car Group (OTCPK:VOLAF) and Kuaishou (OTCPK:KUASF).

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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