The IPO market is gearing up for a week of six deals, four of which are expected to raise more than $100 million

By Ciara Linnane

The deal includes a Korean BBQ restaurant chain, which comes after a euphoric cava deal

There were signs of life at the IPO on Monday. There are six deals lined up this week, four of which are expected to fetch more than $100 million.

There were no prices last week, which was shortened by the bank holiday Monday in June. But another optimistic sign is that five companies, along with a special purpose acquisition corporation (SPAC), have filed for an IPO.

On the agenda for this week is Korean BBQ chain Gen Restaurant Group, which pushed back its deal from last week to this one. The company likely hopes to emulate the success of Cava Group Inc., the Mediterranean-style restaurant chain, which went public in mid-June at $22 a share and was last trading at $42.95.

According to IPO exchange-traded fund provider Renaissance Capital, the cava deal’s surge of more than 99% in its first day of trading was the largest for a U.S. company since 2021 and the largest for a restaurant IPO since Shake Shack in 2015 and institutional research.

“It’s clearly the green light for restaurant deals,” Renaissance co-founder and CEO Bill Smith said in a recent comment.

There are several bullish signals for the IPO market right now, starting with the IPO ETF (IPO), which is up around 26% year-to-date, outpacing the S&P 500’s 13% rise.

The Federal Reserve’s decision to leave interest rates unchanged at its most recent meeting has some investors anticipating another bull market, likely to draw interest from retail and institutional money hungry for IPOs.

Renaissance has counted 46 U.S. deals so far this year, up 21% from the same period a year ago when the market was completely frozen. The companies brought in total revenue of $7.6 billion, up 91% from a year ago.

In terms of activity, 89 deals were submitted, 16% more than a year ago.

The biggest deal expected this week is from Mexico-listed Vesta Real Estate, which focuses on industrial real estate. The Company plans to raise approximately $401 million at a valuation of approximately $2.6 billion, with proceeds earmarked for land or property acquisitions and infrastructure investments.

Also Read: Sagimet Biosciences Gives IPO a Second Chance Under New CEO

Vesta has applied for a listing on the New York Stock Exchange under the ticker symbol “VTMX”.

The second-biggest deal is expected to come from Kodiak Gas Services, which is looking to raise up to $353 million at a valuation of $1.7 billion. The natural gas compression company has assets in the Permian Basin and the Eagle Ford Shale and plans to list on the NYSE under the ticker symbol KGS.

According to Renaissance, Savers Blue Village, the largest for-profit chain of thrift stores in North America, aims to raise $300 million at a $2.8 billion valuation. The company has 317 branches operating under different names. The aim is to be listed on the NYSE under the ticker symbol “SVV”.

Fidelis Insurance Holdings, a Bermuda-based reinsurance company, is seeking a $298 million raise at a $2.1 billion valuation. The company has applied for a listing on the NYSE under the ticker symbol “FIHL”.

Gen Restaurant is expected to be a much smaller deal than Cava, with plans to rake in $33 million at a $352 million valuation. The company has 34 locations, most of them in California, although unlike cava, it’s profitable.

For more information, see: Cava Group’s CFO is confident the restaurant chain will be profitable – but won’t say when

For more information, see: 5 Things You Should Know About Mediterranean Fast-Casual Restaurant Chain Cava

The company has applied for a listing on the Nasdaq under the ticker symbol “GENK”.

Rounding out the list is Alliance Entertainment Holding (AENT), a publicly traded wholesaler and direct-to-consumer supplier to the entertainment industry.

“We are the gateway between brands and retailers,” according to the company’s filing documents.

The company has applied for a listing on the Nasdaq under the ticker symbol “AENT”.

– Ciara Linnane

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6/26/23 1100ET

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