U.S. IPO Week Ahead: Large Foreign Filers And A U.S. Unicorn Lead 10-Deal Week

July’s post-holiday flood of IPOs is upon us, with nine diverse offerings and a direct listing scheduled for the second-most active week of the year. The three largest IPOs come from Asia, Europe, and South America, but based on the strong reception of recent tech unicorns, Medallia (MDLA) may get the most eyeballs.

DouYu (DOYU) is set to be the year’s largest Chinese issuer to tap US markets, raising $859 million at the midpoint. One of China’s two major e-sports streaming companies, DouYu is coming public after an extremely impressive 1Q19 that saw a spike in both revenue and margins, though it still lags close peer and 2018 IPO HUYA (NYSE:HUYA) by both measures.

Three biotechs are on deck, led by Denmark-based Genmab’s (GMAB) $503 million offering, the year’s largest for a biotech. Listed in Copenhagen and offering ADSs at its last close, Genmab’s proposed market cap of about $12 billion should make it the largest US listing of a biotech in 20 years. The company generates over $400 million in licensing revenue for its approved antibodies targeting cancer, and is developing its own pipeline.

Backed by Third Rock and Glaxo, Fulcrum Therapeutics (FULC) recently began a Phase 1 trial for its lead candidate, targeting a rare genetic disease. Backed by NEA and Frazier, Mirum Therapeutics (MIRM) recently began Phase 3 enrollment for its rare liver disease candidate.

Two South American companies are scheduled. Listed on Lima’s stock exchange, Intercorp Financial (IFS) is one of Peru’s largest providers of banking, insurance and wealth management services, with $1.5 billion in 2018 revenue and about $330 million in net income. Brazil-based medical education group Afya (AFYA) is growing relatively fast (+20% organic in 1Q19) and profitably (46% EBITDA margin), though the company faces integration risks with its acquisitions, on top of regulatory and geographic risks.

Two US tech IPOs are coming this week, most notably Medallia, targeting $247 million at a valuation of nearly $3 billion. A close comp to Qualtrics (XM), which was acquired for $8 billion on the eve of its IPO, Sequoia-backed Medallia provides a fast-growing enterprise software solution focused on improving user experience. Built to optimize the patient check-in process at healthcare organizations, Phreesia (PHR) is raising $125 million at a market cap of $658 million. The SaaS provider’s revenue rose 19% in the MRQ, though EBITDA swung negative (-1%).

California-based RIA platform AssetMark Financial (AMK) helps financial advisors managing $50 billion in assets outsource back- and middle-office support services. Acquired by China’s Huatai Securities in 2016 for $780 million, the company plans to raise $250 million at a market cap of $1.4 billion.

Last up is iHeartMedia (IHRT), which previously filed for an IPO, but withdrew the offering in favor of a direct listing on the Nasdaq.

U.S. IPO Calendar

Issuer
Business

Deal Size
Market Cap

Price Range
Shares Filed

Top
Bookrunners

DouYu International
Wuhan, China

$859M
$4,406M

$11.50 – $14
67,387,112

Morgan Stanley
JP Morgan

Tencent-backed live e-sports streaming platform.

AssetMark Financial
Concord, CA

$250M
$1,450M

$19 – $21
12,500,000

JP Morgan
Goldman

Provides a wealth management platform for independent financial advisers.

Fulcrum Therapeutics
Cambridge, MA

$77M
$411M

$16 – $18
4,500,000

Morgan Stanley
BofA ML

Developing small molecule therapies based on gene regulation for rare diseases.

Genmab
Copenhagen, Denmark

$503M
$11,791M

$18.11
27,800,000

BofA ML
Morgan Stanley

Developing novel antibodies for cancer and other diseases.

Mirum Pharmaceuticals
Foster City, CA

$75M
$377M

$14 – $16
5,000,000

Citi
Evercore ISI

Late-stage biotech developing therapies for rare cholestatic liver diseases.

Phreesia
New York, NY

$125M
$658M

$15 – $17
7,812,500

JP Morgan
Wells Fargo

Provides a patient-intake software platform for healthcare providers.

Afya
Nova Lima, Brazil

$234M
$1,491M

$16 – $18
13,744,210

BofA ML
Goldman

Brazilian for-profit medical and healthcare education group.

iHeartMedia
San Antonio, TX

direct listing

direct listing

Goldman
Morgan Stanley

Restructured radio station operator with the US’s largest footprint.

Intercorp Financial
Lima, Peru

$423M
$5,370M

$44 – $50
9,000,000

BofA ML
JP Morgan

Leading bank, insurer, and wealth manager in Peru.

Medallia
San Francisco, CA

$247M
$2,828M

$16 – $18
14,500,000

BofA ML
Citi

Provides enterprise software used to analyze and improve user experience.

The following IPOs are expected to price this week:

Afya, a Brazilian for-profit medical and healthcare education group, plans to raise $234 million by offering 13.7 million shares at a price range of $16.00 to $18.00. At the midpoint of the proposed range, Afya would command a market value of $1.5 billion. Afya, which was founded in 1999, booked $111 million in sales over the last 12 months. The Nova Lima, Brazil-based company plans to list on the Nasdaq under the symbol AFYA. BofA Merrill Lynch, Goldman Sachs, UBS Investment Bank and Itau BBA are the lead joint bookrunners on the deal.

AssetMark Financial Holdings, which provides a wealth management platform for independent financial advisers, plans to raise $250 million by offering 12.5 million shares at a price range of $19.00 to $21.00. At the midpoint of the proposed range, AssetMark would command a market value of $1.4 billion. AssetMark, which was founded in 1994, booked $371 million in revenue over the last 12 months. The Concord, CA-based company plans to list on the NYSE under the symbol AMK. J.P. Morgan, Goldman Sachs, Credit Suisse and Huatai Securities are the joint bookrunners on the deal.

DouYu International Holdings, a Tencent-backed live e-sports streaming platform, plans to raise $859 million by offering 67.4 million ADSs at a price range of $11.50 to $14.00. At the midpoint of the proposed range, DouYu International Holdings would command a market value of $4.4 billion. DouYu International Holdings, which was founded in 2014, booked $652 million in sales over the last 12 months. The Wuhan, China-based company plans to list on the Nasdaq under the symbol DOYU. Morgan Stanley, J.P. Morgan, BofA Merrill Lynch and CMB International Capital are the joint bookrunners on the deal.

Fulcrum Therapeutics, which is developing small molecule therapies based on gene regulation for rare diseases, plans to raise $77 million by offering 4.5 million shares at a price range of $16.00 to $18.00. At the midpoint of the proposed range, Fulcrum Therapeutics would command a market value of $411 million. Founded in 2015, the Cambridge, MA-based company plans to list on the Nasdaq under the symbol FULC. Morgan Stanley, BofA Merrill Lynch and SVB Leerink are the joint bookrunners on the deal.

Genmab, which is developing novel antibodies for cancer and other diseases, plans to raise $503 million by offering 27.8 million ADSs at a price of $18.11, based on its share price in Copenhagen. At that price, Genmab would command a market value of $11.8 billion. Genmab, which was founded in 1998, booked $442 million in revenue over the last 12 months. The Copenhagen, Denmark-based company plans to list on the Nasdaq under the symbol GMAB. BofA Merrill Lynch, Morgan Stanley and Jefferies are the joint bookrunners on the deal.

Intercorp Financial Services, a leading bank, insurer, and wealth manager in Peru, plans to raise $423 million by offering 9.0 million shares at a price range of $44.00 to $50.00. At the midpoint of the proposed range, Intercorp Financial Services would command a market value of $5.4 billion. Intercorp Financial Services, which was founded in 1897, booked $1.8 billion in revenue over the last 12 months. The Lima, Peru-based company plans to list on the NYSE under the symbol IFS. BofA Merrill Lynch, J.P. Morgan and Itau BBA are the joint bookrunners on the deal. The company currently trades on the Lima Stock Exchange under the symbol IFS.

Medallia, which provides enterprise software used to analyze and improve user experience, plans to raise $247 million by offering 14.5 million shares at a price range of $16.00 to $18.00 Top shareholder Sequoia intends to invest $10 million in a concurrent private placement. At the midpoint of the proposed range, Medallia would command a market value of $2.8 billion. Medallia, which was founded in 2001, booked $337 million in sales over the last 12 months. The San Francisco, CA-based company plans to list on the NYSE under the symbol MDLA. BofA Merrill Lynch, Citi, Wells Fargo Securities and Credit Suisse are the joint bookrunners on the deal.

Mirum Pharmaceuticals, a late-stage biotech developing therapies for rare cholestatic liver diseases, plans to raise $75 million by offering 5.0 million shares at a price range of $14.00 to $16.00. At the midpoint of the proposed range, Mirum Pharmaceuticals would command a market value of $377 million. Mirum Pharmaceuticals was founded in 2018. The Foster City, CA-based company plans to list on the Nasdaq under the symbol MIRM. Citi, Evercore ISI and Guggenheim Securities are the joint bookrunners on the deal. Insiders intend to purchase up to $35 million of the IPO (47% of the deal).

Phreesia, which provides a patient-intake software platform for healthcare providers, plans to raise $125 million by offering 7.8 million shares at a price range of $15.00 to $17.00. At the midpoint of the proposed range, Phreesia would command a market value of $658 million. Phreesia, which was founded in 2005, booked $104 million in sales over the last 12 months. The New York, NY-based company plans to list on the NYSE under the symbol PHR. J.P. Morgan, Wells Fargo Securities, William Blair and Allen & Company are the joint bookrunners on the deal.

iHeartMedia, a restructured radio station operator with the US’s largest footprint, stated in a press release that it plans to move forward with a direct listing. As of Friday, July 12, it had not filed a prospectus for the direct listing, but does plan to meet with investors in the coming week.

IPO Market Snapshot

The Renaissance IPO Indices are market cap weighted baskets of newly public companies. As of 7/11/19, the Renaissance IPO Index was up 41.5% year-to-date, while the S&P 500 had a gain of 21.0%. Renaissance Capital’s IPO ETF (NYSE: IPO) tracks the index, and top ETF holdings include Spotify (NYSE:SPOT) and Elanco (NYSE:ELAN). The Renaissance International IPO Index was up 13.7% year-to-date, while the ACWX was up 14.1%. Renaissance Capital’s International IPO ETF (NYSE: IPOS) tracks the index, and top ETF holdings include SoftBank and Meituan-Dianping.

Editor’s Note: The summary bullets for this article were chosen by Seeking Alpha editors.