People with knowledge of the transaction told CNBC that the solar technology startup Nextracker priced its initial public offering marginally over its stated $20 to $23 per share range.
According to anonymous sources who spoke to CNBC earlier on Wednesday (February 8, 2023), the order book for Fremont, California-based Nextracker was “well subscribed,” which meant that there was sufficient demand for the company to provide prices that were higher than anticipated.
By selling 26.6 million shares at a price of $24, the IPO is anticipated to raise nearly $638 million, much beyond the $535 million cap the business stated it was aiming for in a filing last week. The folks said that this is also before the so-called “greenshoe option” which permits bankers to sell more stock.
The development is a good sign for the moribund IPO market. Proceeds from public listings fell 94% last year after the Federal Reserve began its most aggressive rate-increasing campaign in decades. Investors soured on the shares of unprofitable tech companies in particular, many of which are still underwater after listing in 2020 and 2021.
The Nextracker IPO is arguably the first meaningful public listing this year as it is set to be the biggest U.S. IPO since autonomous driving firm Mobileye raised $990 million in October.
Bookrunners first secured anchor investments in Nextracker from BlackRock and Norges Bank Investment Management, which helped drive demand for shares, the people said.
Nextracker will begin trading on the Nasdaq exchange Thursday morning under the symbol NXT, according to one of the people.
The company, which was a division of the manufacturer Flex, offers gear and software that allows solar panels to track the sun’s path, increasing the efficiency of solar power plants.
JPMorgan Chase was lead advisor on the transaction, according to a regulatory filing.