The IPO Buzz: Intensity Therapeutics & Vesta Climb in Debuts on June’s Last Day

Intensity Therapeutics (INTS), a cancer biotech’s small-cap IPO, and Vesta Real Estate Corp. (VTMX), a Mexican industrial real estate company’s ADS offering, scored solid gains on Friday, June 30, 2023. Intensity Therapeutics’ stock jumped 19 percent to open at $5.95, up 95 cents from its $5.00 IPO price, on the NASDAQ. Vesta’s American Depositary Shares (ADS) gained 3.23 percent to open at $32.00, up $1.00 from their public offering price of $31.00, on the New York Stock Exchange. Vesta’s offering is not an IPO; its common stock already trades on the Mexican Stock Exchange.

INTS is the last IPO priced in June 2023. This month will be remembered for CAVA Group Inc.’s (CAVA) strong debut, which blasted off into a moonshot during its first day of trading (June 15, 2023). The successful IPO yesterday of Savers Value Village (SVV) underscored the perception that the IPO market is making a comeback after a drought of almost 18 months.

Intensity Therapeutics priced its upsized IPO at $5.00 – the top of its $4.00-to-$5.00 price range – on 3.9 million shares on Thursday night (June 29, 2023) to raise $19.5 million. The IPO was increased by 650,000 shares at pricing from the 3.25 million shares in the prospectus.

The Benchmark Company and Freedom Capital Markets were the joint book-runners.

Intensity Therapeutics, based in Westport, Connecticut, is evaluating its lead product candidate, INT230-6, as a treatment for recurrent and metastatic cancer. Its approach involves the direct injection into tumors of a unique product created from its DfuseRx discovery platform. INT230-6, its lead product candidate, consists of two proven anti-cancer cytotoxic agents – cisplatin and vinblastine sulfate mixed with the amphiphilic molecule (SHAO) – all in one vial.

A Phase 2 trial is under way:

• In four cohorts of the Phase 2 trial, Intensity Therapeutics’ product, INT230-6, is combined with Merck’s Keytruda (pembrolizumab) and
• In three arms of the Phase 2 trial, Intensity Therapeutics’ product, INT230-6, is combined with Bristol-Myers Squibb’s drug Yervoy (ipilimumab).
• The company says it is also evaluating INT230-6 in a Phase 2 study (the INVINCIBLE study) in Canada as a treatment before surgery in early-stage breast cancer.

Like most newly public biotechs, Intensity Therapeutics has no revenue. The company reported a net loss of $6.55 million for the 12 months that ended March 31, 2023.

From Mexico to the Big Apple

Vesta Real Estate Corp. (VTMX) attracted a lot of interest this week with the launch of its public offering of 12.5 million American Depositary Shares (ADS) on the NYSE. Some IPO services and some financial news outlets call Vesta’s deal an IPO or its U.S. IPO of its American Depositary Shares. Vesta’s SEC filing does not call this offering an IPO. Vesta’s common stock trades on the Mexican Stock Exchange under the symbol “VESTA” – as the prospectus notes. Each ADS represents 10 shares of common stock.

Vesta Real Estate priced its public offering of 12.5 million ADS at US$31.00 on Thursday night (June 29, 2023). The offering price was below the as-converted last closing price of $32.31 of its stock on the Mexican Stock Exchange. Vesta’s ADS offering raised $387.5 million.

Citigroup, BofA Securities, Barclays, Morgan Stanley and Scotia Capital were the joint book-runners.

Vesta Real Estate Corp. is a holding company incorporated in Mexico. Founded in 1998, the company is profitable.

“We own, operate and lease industrial properties across 15 states in Mexico,” the prospectus says. “Our portfolio consisted of 202 buildings with 33.7 million square feet of gross leasable area (“GLA”) and a stabilized occupancy rate of 96.7 percent as of March 31, 2023.  We develop light manufacturing and distribution centers through Build-to-Suit (BTS) buildings designed to our clients’ specific needs. We also develop “inventory buildings” without a lease for clients that do not have the time or interest in BTS buildings.

“We believe that we are one of the only fully vertically integrated and internally managed Mexican industrial real estate companies that owns, manages, develops and leases industrial properties, on a large scale, in Mexico, which we believe differentiates us from our competitors,”  the prospectus says.

For the 12 months that ended March 31, 2023, Vesta Real Estate Corp. reported net income of $225.1 million. Its revenue was $186.2 million, according to the prospectus.

A third deal – the tiny public offering/NASDAQ uplisting of Alliance Entertainment Holding (AENT) – was priced Thursday night (June 29, 2023). The offering was downsized at pricing to 1.34 million shares – down from 1.67 million shares in the prospectus – and priced at $3.00 to raise $4.0 million.  The stock, formerly traded on the OTC Pink Market, was uplisted to the NASDAQ on Friday (June 30, 2023).

Alliance Entertainment’s stock opened at $2.60, down 40 cents from its IPO price, on Friday on the NASDAQ. The stock was down 1.2 percent at $2.57 with just 15 minutes to go until Friday’s closing bell.

ThinkEquity was the sole book-runner for the uplisting/public offering.

Alliance Entertainment Holding, based in Plantation, Florida, is a profitable global wholesaler, direct-to-consumer distributor and e-commerce provider for the entertainment industry. The company’s inventory consists of vinyl records, video games, CDs, DVDs and Blu-Ray discs, toys and collectibles. Alliance serves as the gateway between branded manufacturers of entertainment content – for example, Universal Pictures, Walt Disney Studios and Sony Music – and leading retail customers such as Walmart, Amazon and Costco in the U.S. and internationally.

For the year ended June 30, 2022, Alliance Entertainment earned net income of $28.5 million on revenue of $1.42 billion.

(For more information about these companies, please check the IPO Calendar and the individual IPO Profiles found on IPOScoop.com’s website.)