The developer of novel cancer vaccines
sold 53.4m shares at $1.00 each or a 7.4%
discount to last sale. Each share came with
an accompanying warrant to purchase half
of one share, with each two warrants
entitling the holder to buy one share at an
exercise price of US$1.20 a share.
Cantor acted as sole bookrunner.
INVESTORS KICK IN FOR BOOT BARN0RIVATEûEQUITYûlRMû&REEMANû3POGLIûû#Oû
sold half of its remaining stake in cowboy
boots retailer BOOT BARN via a long-awaited
stock sell-down late on Wednesday.
Taking advantage of Boot Barn’s galloping
share price recovery in recent months,
including a 15% surge in 2018 ahead of the
launch, Boot Barn ended up pricing an
upsized secondary offering of 6m shares (up
from 5.5m at launch) at US$17.25 for
secondary proceeds of US$103.5m.
The deal priced after a day of marketing
by leads JP Morgan, Piper Jaffray, Jefferies, Wells
Fargo, Baird and Cowen.
The price represented a large all-in
DISCOUNTûOFûû4HISûREmECTEDûTHEûHEFTYûSIZEû
of the deal (22% of outstanding) and the
stock’s run-up coming into the offering.
Freeman Spogli, a New York-based mid-
MARKETûPRIVATEûEQUITYûlRM ûSOLDûMûSHARESû
or about half of its remaining shares in the
offering, with management selling
accounting for the balance.
The deal leaves the sponsor with about
7m shares or around 25% of Boot Barn.
A recent recovery in comp store sales has
helped Boot Barn stage a strong share pricecomeback from under US$10 a share in
early November.
The 5.2% comp store sales growth Boot
"ARNûREPORTEDûINûITSûlSCALûTHIRDûQUARTERûû
was easily the company’s best performance
SINCEûTHEûlRSTûQUARTERûOFûû9ETûTHISûWASû
still well shy of the double-digit numbers it
was reporting from 2011-2013.
Boot Barn went public at US$16.00 in
October 2014 and has since completed one
follow-on in February 2015, but withdrew
the registration statement for a second
follow-on after its share price sank during
the second half of 2015.FORTRESS RETURNS WITH NEW RESI
EQUITY RAISINGAlternative asset manager Fortress
continued its aggressive start to 2018
when the residential mortgage/MSR REIT it
manages, NEW RESIDENTIAL INVESTMENT CORP,
completed a US$427.5m overnight block
trade late on Tuesday.
A syndicate led by Credit Suisse, JP Morgan,
Bank of America Merrill Lynch, BTIG, B.Riley/
FBR and UBS reoffered their 25m-share
PURCHASEûATûAûlXEDûPRICEûOFû53 ûAûû
discount to last sale but well above book
value of US$14.87 a share at September 30.
In Wednesday’s aftermarket, New
Residential shares fell 2.5% to US$17.19,
holding modestly above the offering price.
The offer price was above the US$15.00
at which New Residential raised
US$737.6m in equity a year ago.
New Residential will use the net proceeds
from the latest offering for investments and
general corporate purposes.
The REIT revealed alongside the offering
that it expects to report 2017 net income
of US$3.12-$3.20 a share and core earnings
of US$2.79-$2.87 a share, driven by a
decrease in market discount rates.
The deal continues a busy start to the
year for Fortress, which was purchased by
Japan’s Softbank late last year for
US$3.3bn (the deal was completed in late
December).
Already this year, Fortress has sold its 40%
stake in consumer credit provider OneMain
and raised equity for its infrastructure
vehicle, Fortress Transportation and
Infrastructure Investors.
Softbank is operating Fortress, which has
US$36.1bn in assets under management, as
an independent business headquartered in
New York.GOLDMAN SELLS GOLDEN STOCKGOLDEN ENTERTAINMENT, operator of the
Stratosphere casino and hotel in Las Vegas,
priced a US$182m two-day marketed all-
secondary stock sale late on Thursday.Biotechs cross over to
public markets
US Heavy insider support supplements fundingA wave of biotech funding early in the new year
is not surprising, given the tailwind provided by
last week’s JP Morgan conference and associated
marketing frenzy.
SOLID BIOSCIENCES, a Duchenne muscular
dystrophy specialist; immuno-oncology specialist
ARMO BIOSCIENCES; and aging-related disease
specialist RESTORBIO all raised money privately
late last year, and all are seeking to extend that
support on their IPOs.
Existing investors put in for an additional
US$40m on the IPOs of the first two and
US$35m on the last, representing roughly 40%
of the funding in each case, a typical level of
support.
Solid, founded by former JP Morgan banker
Ilan Ganot in 2012 shortly after his son was
diagnosed with DMD, is using proceeds to help
fund the US$130m it needs for Phase I/II trials
on its DMD drug candidate through preliminary
read-out.
JP Morgan, Goldman Sachs, Leerink Partners
are joint books on the all-primary sale of 5.89m
shares being marketed at US$16–$18, including
up to US$40m insiders have spoken for.
Solid was able to trigger second closing of a
US$55m private funding round in October after
hitting certain pre-clinical milestones associated
with the initial US$25m that closed in March.
DMD is a genetic muscle wasting disease
that afflicts 10,000 to 15,000 young boys in
the US. Sarepta Therapeutics, a serial equity
issuer, provided an indication of the potential by
recently estimating sales this year for its DMD
drug at US$295m–$305m.Armo is using the IPO funding to advance
development of its immuno-oncology drug.
Results from a first interim analysis on a Phase
III trial are expected early this year, though a
second interim analysis that would serve as the
basis of an application to the US Food and Drug
Administration is not expected to be conducted
until 2020.
The drug, which it licensed from Merck,
has been granted fast-track designation by
regulators in the US and EU as a second-line
treatment for pancreatic cancer.
Jefferies, Leerink Partners and BMO Capital
Markets are joint bookrunners on the all-primary
sale of 6.67m shares being marketed at US$14–
$16 (including US$40m from insiders), marking
a 20% step-up from the valuation achieved on a
US$67m private round completed in August.
Restorbio is seeking a more aggressive, 50%
private-to-public step-up on its IPO.
Bank of America Merrill Lynch, Leerink Partners
and Evercore are marketing 5.67m primary
shares at US$14–$16, versus the US$10.69 per
share valuation on a US$50m November private
round.
Some of the those investors committed for up
to US$35m on the offering, making the valuation
step-up more palatable.
Restorbio plans to use the bulk of the IPO
proceeds on a Phase IIb trial of a drug that
inhibits a specific gene that regulates aging and
increases susceptibility to a variety of diseases.
It licensed the drug from Novartis International
last March.
Stephen Lacey