ArborGen sets new IPO terms to raise up to $US92m
Tree-seeding company ArborGen says it hopes to raise up to $US92 million under revised terms for its initial public offering in the US.
The company, which is 33% owned by NZX-listed Rubicon, said it planned to sell about 5.1 million shares for $US16 to $US18 each to raise between $US82– $US92 million in cash (before expenses).
In October, it had registered to raise up to an estimated $US75 million in its debut listing on the Nasdaq Global Market.
The revised share issue would result in Rubicon’s ownership in ArborGen moving to 27.24%
ArborGen’s operations once formed part of New Zealand forestry giants Fletcher Challenge and Carter Holt Harvey.
The company grows commercial forestry seedlings for customers in the pulp and paper and wood-products industries, as well as biopower companies.
Most of its customers are in the US, New Zealand and Australia, with an increasing base in Brazil.
ArborGen has never been profitable, largely due to investment in research and development.
The company will use the proceeds of the IPO to purchase a new manufacturing, research and development laboratory and headquarters facility, and construct related infrastructure.
The money will also be used to expand container production capacity and for the repayment of outstanding debt under a revolving credit facility.
Goldman, Sachs & Co and Citigroup have been appointed joint book-runners for the proposed offering.