Fox Factory Holding Corp. dialed in details of its IPO Thursday, saying it would price its initial public offering of 8,571,429 shares of its common stock at $15.00, or the high end of the range targeted last month.
That price values the company, which makes high performance suspension systems for mountain bikes and motor vehicles, at just over $500 million, or about 1.8 times projected 2013 revenues and just over 10 times projected adjusted EBITDA. At $15 per share, Fox Factory Founder Robert C. Fox Jr.’s 13.9 percent stake in the company would be worth $70 million.
Of the shares of common stock in the offering, Fox is offering 2,857,143 shares and certain stockholders of Fox, including Compass Group Diversified Holdings LLC (CODI), are offering 5,714,286 shares. The selling stockholders have granted the underwriters a 30-day option to purchase up to an additional 1,285,714 shares at the initial public offering price less underwriting discounts and commissions. Fox will not receive any proceeds from the sale of shares by the selling stockholders.
Assuming the IPO closes as expected, FOX intends to use the proceeds and anticipated borrowings under a new credit facility with a third-party lender to repay the then outstanding indebtedness under its existing credit facility with CODI, which facility had an outstanding balance of $65.5 million as of June 30, 2013.
Upon completion of the IPO, CODI expects to own approximately 56.8 percent of the outstanding shares of FOX common stock, assuming no exercise of the option to purchase additional shares granted to the underwriters, or approximately 53.9 percent, assuming full exercise of the option granted to the underwriters. CODI currently owns 75.8 percent of the company.
The shares are expected to begin trading on the Nasdaq Global Select Market on Aug. 8, 2013 under the ticker symbol “FOXF”.
Robert W. Baird & Co. Incorporated, William Blair & Company, L.L.C. and Piper Jaffray & Co. are acting as joint book-running managers for the offering. Stifel, Nicolaus & Company, Incorporated, SunTrust Robinson Humphrey, Inc., BB&T Capital Markets, a division of BB&T Securities, LLC, and CJS Securities, Inc. are acting as co-managers.