The IPO Buzz: Energy & Digital Ad IPOs On Tap After Iran Attacks Israel

Two big IPOs – Centuri, a natural gas play, and Ibotta, an AI-driven digital ad platform – are in the spotlight today – Monday, April 15, 2024 – after Iran attacked Israel over the weekend. Both IPOs are set to price mid-week. Both are New York Stock Exchange listings. The rest of this week’s IPO Calendar consists of a handful of small IPOs and a modest NASDAQ uplisting deal. U.S. stock futures rose early today. Bloomberg reported that global markets showed signs of stability and oil prices fell as traders bet that tensions in the Middle East won’t escalate after Iran’s attack on Israel. Brent oil futures slipped below $90 a barrel and U.S. crude oil futures dipped below $85 a barrel early today. Gauzy Ltd., an Israeli company that makes light and vision control systems for leading aerospace, automotive and architecture companies, filed its F-1 on Monday to go public, without disclosing terms in the prospectus. The IPO’s size is estimated at $100 million, a placeholder figure. (The prospectus was published on Monday, April 15, 2024, in the SEC filings; the date on the cover of the prospectus is April 12, 2024.) Barclays, TD Cowen and Stifel are the  joint book-runners of Gauzy’s IPO. Good Timing for a Natural Gas IPO The energy play, Centuri Holdings (CTRI Proposed), is a carve-out deal. Sole stockholder Southwest Gas Holdings Inc. (SWX) is offering all the stock in the natural gas pipeline company’s IPO. After the IPO. Southwest Gas will still own 82.7 percent of Centuri, the prospectus says. Centuri’s customers are the leading electric, gas and combination utility companies in North America, the prospectus says. Centuri’s IPO consists of 12.4 million shares at a price range of $18.00 to $21.00 to raise $241.8 million. The market cap is about $1.7 billion, assuming mid-point pricing at $19.50. UBS Investment Bank, BofA Securities,  J.P. Morgan and Wells Fargo Securities are the joint book-runners. The IPO is set for pricing on Wednesday night, April 17, to trade Thursday, April 18, on the New York Stock Exchange. “It’s right sector, right time,” a seasoned IPO pro says. “It’s (natural) gas. Look at oil right now, setting new highs. It’s in good shape. And there’s a private placement for Icahn.” In conjunction with the IPO, Centuri is conducting a private placement of another 2.59 million shares at the IPO price to two investment vehicles controlled by Carl Icahn. Centuri reported a net loss for the year ended Dec. 31, 2023. Sweet Sound of Ka-Ching Ibotta (IBTA Proposed) is a Denver-based digital ad platform company that says it makes money only when a customer’s product promotion results in a sale. Walmart, Family Dollar (a Dollar Tree subsidiary), Kroger and Shell are among Ibotta’s clients, the prospectus says. Ibotta’s IPO terms got the market’s attention: 5.63 million shares at a price range of $76.00 to $84.00 to raise $450.0 million, based on mid-point pricing at $80.00. Ibotta would have a market cap of about $2.43 billion. “I did a double-take when I saw the price range,” a savvy IPO trader says. Goldman Sachs, Citigroup and BofA Securities are the joint book-runners. Ibotta is offering 2.5 million shares and the selling stockholders are  offering 3.125 million shares, the prospectus says. Ibotta’s IPO is set for pricing on Wednesday night, April 17, to trade Thursday, April 18, on the NYSE. Ibotta says its AI-enabled technology platform lets consumer product group brands deliver digital  promotions to over 200 million consumers through a single convenient network called the Ibotta Performance Network (IPN). “We are pioneers in success-based marketing: we only get paid when our client’s promotion results in a sale, not when a consumer merely views or clicks on the promotion,” Ibotta says in the prospectus. For the year ended Dec. 31, 2023, Ibotta swung to a profit from a year-earlier loss, according to the prospectus. Spring Awakening for IPOs The IPO market scored some impressive gains last week. Those successful deals were part of the spring awakening that began in March with the Astera Labs and Reddit IPOs. Some IPO experts are optimistic that the IPO market may be regaining its health after two of the slowest years since 2008. UL Solutions (ULS), the iconic name brand behind safety testing of electrical consumer products, priced its IPO at $28.00 and the stock jumped 24.79 percent to close Friday on the NYSE at $34.94. A U.S. nursing home chain, PACS Group (PACS), priced its IPO at $21.00 and the stock shot up to close at $23.00 on Thursday, its first day of NYSE trading. On Friday, PACS Group’s stock continued its climb – closing at $24.00. A small-cap IPO, Singapore’s Mobile-health Network Solutions, priced its IPO at $4.00 and the stock climbed on Thursday to close at $6.70 on the NASDAQ. Fast forward to Friday, April 12, when the stock closed at $15.00 – up 275 percent from its IPO price. Stay tuned.