initial public offerings (IPOs) trading on American exchanges

Tuesday, June 21, 2016

SolarCity (SCTY) to be acquired by Tesla (TSLA)

  • Tesla's bailout of Elon Musk cousin's company, SolarCity.
SolarCity (SCTY): Elon Musk proposes combining his electric-car Tesla Motors (TSLA) and solar-power companies in a potential $2.8 billion deal. (6/21/16)

Elon Musk proposed combining his electric-car and solar-energy companies, in a bold effort to consolidate his holdings and offer widespread clean-energy products from vehicles to power in homes.

Tesla Motors Inc., Mr. Musk’s Palo Alto, Calif., electric-car company, on Tuesday offered to acquire SolarCity Corp. in a stock deal valuing it at up to $2.8 billion. Mr. Musk is the chairman and largest shareholder of both companies.

Tesla in a letter to SolarCity’s chief executive said its offer represented a value of $26.50 to $28.50 a share, or a premium of roughly 21% to 30% over SolarCity’s Tuesday closing price of $21.19.

***** The following day / reaction:

To many, the buyout looked like a bailout of one Musk company for another. SolarCity has more than $3 billion in debt and Goldman Sachs claims it is very close to breaching its loan covenants.

Corporate governance questions are being raised because Musk owns 21.1% of Tesla and 22.5% of SolarCity. And two Musk cousins are the CEO and CTO of SolarCity. In addition, only two of Tesla's directors have no ties to SolarCity and only one SolarCity director has no ties to Tesla.

Another factor raising eyebrows is the fact that Elon Musk has pledged four million of his 22 million SolarCity shares as collateral against his personal borrowings from Morgan Stanley.

SolarCity shares have plunged this year. Was Musk near getting a margin call? That's a very legitimate question many are asking.

For his part, Musk called the deal a “no-brainer.” He sees it as the next logical step in his vision of the future of sustainable energy and transportation. The newly-merged firm would be an “integrated sustainable energy company” that would become the first company with a trillion dollar valuation, says Musk.

One thing is certain. Existing Tesla shareholders will see their stake further diluted as Tesla will issue another $2.5 billion in stock in order to buy SolarCity. Tesla is offering between 0.122 and 0.131 of its shares for each share of SolarCity.

If one includes the stock offering in May, Tesla's existing shareholders are seeing nearly a 14% dilution of their shares in just a few short months.

Saturday, June 18, 2016

PSAV postpones IPO

PSAV Inc. has postponed its initial public offering as a result of unfavorable equity market conditions.

The global provider of event technology said it will continue to evaluate the timing for the proposed offering as market conditions develop.

PSAV conducts more than 1.5 million meetings annually, and customers include event organizers, corporations, trade

associations and meeting planners. PSAV has more than 8,200 employees across over 1,400 luxury and upper upscale hotels, resorts and convention centers in 13 countries.

Tuesday, June 7, 2016

Vince Holding (VNCE) reported earnings Tue 7 June 2016 (b/o)

** charts before earnings **  


** charts after earnings **



Vince Holding beats by $0.06, beats on revs; reaffirms FY17 EPS guidance, revs guidance :
  • Reports Q1 (Apr) loss of $0.05 per share, $0.06 better than the Capital IQ Consensus of ($0.11); revenues rose 13.0% year/year to $67.6 mln vs the $55.45 mln Capital IQ Consensus. 
    • Wholesale segment sales increased 16.9% to $44.8 million and direct-to-consumer segment sales increased 6.1% to $22.9 million over the first quarter of fiscal 2015.
    • Comparable sales decreased 12.3%, including e-commerce sales, which was in line with expectations, due to the planned reduction in promotional activity and inventory levels.
    • Gross profit was $28.3 million, or 41.8% of net sales. This compares to gross profit of $30.7 million, or 51.4% of net sales, in the first quarter of fiscal 2015. The decrease in gross profit rate was primarily attributable to a change in product mix and continued strategic investments.
  • Co reaffirms guidance for FY17, sees EPS of $0.00-0.06 vs. $0.03 Capital IQ Consensus; sees FY17 revs of $290-305 mln vs. $298.75 mln Capital IQ Consensus, including revenues from six new retail stores and comparable sales growth inclusive of ecommerce sales in the flat to low-single digit range. The Company expects sales to decrease in the mid- to high-single digit range for the first half of the year and to be flat or increase in the mid-single digit range in the second half of the year as compared to the same prior year periods; Gross margin of ~47%. 

Thursday, June 2, 2016

Qlik (QLIK) acquired by private equity firm Thoma Bravo

Qlik (QLIK) was acquired by private equity firm Thoma Bravo LLC for about $3 billion. (June 2016)


Qlik’s shares were up 4 percent at $30.13 in midday trading on Thursday, slightly below the offer price of $30.50 per share.

The shares had risen 20 percent through Wednesday’s close since Elliott Management Corp. urged a sale in early March.

Qlik, which went public in 2010, focuses on creating applications that help businesses analyze and visualize data to help them cut costs.

The company’s flagship product, QlikView, allows customers to organize vast amounts of data in the form of reports, charts and infographics.

Brean Capital LLC analyst Yun Kim said the price indicated there was “very little interest” for self-service business intelligence (BI) assets.

Elliott, which disclosed an 8.8 percent stake in Qlik in March, had said the company was ripe for being taken over by a larger technology peer.

The hedge fund said later that month it increased its stake to about 10.8 percent. Elliott paid $23.50 per share on average, according to 13D Monitor, a research service that tracks 13D filings.

Qlik joins a growing list of companies such as Compuware Corp, Riverbed Technology Inc, Blue Coat Systems and Informatica that have been bought by private equity firms after Elliott started urging them to sell. Some of these companies were sold to Thoma Bravo.

NantHealth (NH) started trading on the Nasdaq on 2 June 2016

  • The Culver City, California-based company said in its IPO registration last month that Soon-Shiong would own 58 percent of all shares. He will not, however be full-time with NantHealth; instead, he will devote the majority of his time to clinical-stage immunotherapy company NantKwest, which Soon-Shiong took public last year.

Shares of biomolecular medicine company NantHealth Inc. soared in their first day of trading, jumping sharply above their $14 initial public offering price.

The California-based company, started by billionaire physician Dr. Patrick Soon-Shiong, opened on the NASDAQ under the symbol "NH." The company offered 6.5 million shares of common stock at $14, with the shares jumping to $21 after the bell before giving up some of those gains. NantHealth granted underwriters a 30-day option to buy up to 975,000 shares of common stock.

"We estimate that the potential global market for clinics, including GPS Cancer, exceeds $50 billion," the company said in a May 24 SEC filling. NantHealth's total net revenue was $58.3 million in 2015, with a net loss was $72.0 million, it said in the filing.

NantHealth chairman and CEO Dr. Patrick Soon-Shiong, and entities affiliated with him, will control roughly 58 percent of the combined voting power of the outstanding common stock, according to the SEC filing.

Soon-Shiong is also part-owner of the Los Angeles Lakers, the second-biggest investor in Tribune Publishing, and CEO of immunotherapy company NantKwest. He will "primarily focus" on NantKwest and other companies operating under parent company NantWorks, the filing said.

NantHealth gets most of its sales from licensed medical software, record systems, and its hallmark "GPS Cancer" test. The test, which NantHealth distributes to healthcare providers, uses DNA sequencing to guide cancer treatment.

The company delayed an IPO six months ago to acquire the company NaviNet, which includes the GPS cancer test, Soon-Shiong said. After acquiring that company, NantHealth is now at an "inflection point," he said.

"[The GPS test] will transform not only how we make diagnoses at the molecular level but also how we share information on the platform on a national scale," Soon-Shiong told CNBC. The diagnostic test was recently certified by the U.S. Department of Health and Human Services, and is covered by Blue Cross insurance.

Soon-Shiong launched a program to find a vaccine-based immunotherapy to combat cancer in the next four years called "MoonShot 2020." The plan is to use the GPS test to identify the cancer, then introduce a flu-like vaccine to cure or prevent it.

Wednesday, June 1, 2016

Demandware (DWRE) to be acquired by Salesforce (CRM)

Demandware to be acquired by Salesforce (CRM) for $75.00/share in cash :
  • Salesforce (CRM) will acquire Demandware in a transaction worth ~$2.8 bln (net of cash acquired). Under the terms of the agreement, Salesforce will commence a tender offer for all outstanding shares of Demandware for $75.00 per share, in cash. The transaction is expected to close in the second quarter of Salesforce's fiscal year 2017, ending July 31, 2016.
  • The transaction is expected to close in the second quarter of Salesforce's fiscal year 2017, ending July 31, 2016. Following the successful completion of the tender offer, Demandware shares not tendered in the tender offer will be converted in a second step merger into the right to receive the same $75.00 per share in cash paid in the tender offer.

Updated Guidance:
  • FY17 Revenue: The acquisition is expected to increase Salesforce's FY17 total revenue by approximately $100 mln to $120 mln.
    • This estimate reflects an approximately $50 mln reduction relating to fair value adjustments to deferred revenue and unbilled deferred revenue, adjustments related to the combined customer base, and inter-company revenue elimination.
  • The acquisition is expected to decrease FY17 non-GAAP diluted EPS by approximately $0.07. This estimate reflects standard integration costs and transaction fees expected to be in the range of $30 mln.
  • Q2 FY17 Revenue: The acquisition is expected to increase Salesforce's Q2 FY17 total revenue by approximately $0 mln to $10 mln. Q2 FY17 non-GAAP EPS: Transaction fees related to the acquisition are expected to reduce Q2 FY17 diluted non-GAAP EPS by approximately $0.03.
  • Based on the above, Salesforce is updating its guidance previously reported on May 18, 2016, as follows:
    • Q2 FY17 Guidance: Revenue for Salesforce's fiscal second quarter 2017 is projected to be in the range of $2.005 bln to $2.025 bln, an increase of 23% to 24% year-over-year.