initial public offerings (IPOs) trading on American exchanges

Friday, November 15, 2013

Zulily (ZU) prices IPO above range

Seattle’s Zulily Inc. has priced its initial public offering at $22 per share, above the expected range of $18 to $20. 

The e-commerce startup, which markets itself as a daily deal site for mothers, is raising $253 million in its IPO. Zulily is listing on the Nasdaq, under the ticker “ZU.”

Zulily posted a profit of $155,000 on $438.7 million in revenue, during the first nine months of the year. This compares to a loss of $13.6 million in the same period last year, with $202.8 million in revenue. Zulily operated at a loss in 2010 and 2011.

Zulily’s offering is part of a wave of Internet IPOs. Twitter went public last week and textbook rental site, Chegg, completed its IPO on Wednesday. Twitter saw its shares surge 73% on the first day of trading, whereas Chegg fell 23%.

Despite a niche focus, Zulily draws similarities to Groupon GRPN +0.21%, which had a difficult first two years of trading. Yet coupon site, RetailMeNot, has seen its share price go up 55% since its July debut. Flash sale site, Gilt Groupe, is said to have an IPO on the horizon.

Zulily’s largest stockholders are Chairman Mark Vadon, Maveron Capital and CEO Darrell Cavens. Other investors include August Capital, Andreessen Horowitz and Trinity Ventures. Zulily has raised a total of $139 million in venture capital.

Goldman Sachs is the lead manager on the deal. BofA Merrill Lynch, Citigroup C +0.66% and RBC Capital Markets are also bookrunners. Goldman Sachs led Twitter in its IPO last week, which also priced above the expected range.

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