Tuesday 10 February 2015

PGI Specialty Materials, Inc. Files for Initial Public Offering; Details on Size of IPO Not Clear Yet

PGI Specialty Materials, Inc – a company under the umbrella of the Blackstone Group – has filed for an initial public offering (IPO) with regulators in the United States. The company is currently aiming at a common stock IPO. PGI Specialty Materials, Inc. produces materials that are used in the manufacture of products such as disinfectant wipes, diapers and more. Blackstone currently holds a 98% share in PGI. The former had purchased the latter in a cash deal amounting to US$326.2 million from MatlinPatterson, a private equity firm, five years ago in 2010. 

Besides baby products, the specialty materials produced by PGI are also used for manufacturing feminine hygiene products as well as surgical gowns. Some of the most prominent names in PGI’s client list include Kimberly-Clark Corp, Procter & Gamble Co, and Cardinal Health Inc.

Some of the underwriters for the IPO will be Goldman Sachs & Co, Citigroup, BofA Merrill Lynch, and Jefferies. These details were reported by the company in its filing with the U.S. SEC this week. Details submitted during the filing indicate that the company has a fundraising target of about US$100 million. However, the company did not provide details about the number of shares it planned to sell, or at what price these shares would be sold.

Usually, registration fees are calculated based on the amount of money a company plans to raise during its first IPO, based on its statement with the regulators. In many cases, the final size of the IPO differs from this amount.

Moreover, details about which exchange the company intends to be listed on were not specified by the company during the filing process. In the nine-month period ending September 27, 2014, the net loss reported by PGI was about three times higher, touching about US$97.05 million. At the same time, the company reported a 2.2% rise in its net sales, reaching US$1.51 billion.

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