The underwriters for the offering are J.P. Morgan, Barclays, Allen & Co., JMP Securities, Piper Jaffray, Morgan Stanley, Stifel, Raymond James, Baird and Citigroup. The underwriters also have a 30-day option to purchase up to an additional 1.55 million shares of class A common stock.
At the end of September, a total of 99.76 million class B shares and 26.29 million class A shares were outstanding. The largest shareholder is the Woodman Family Trust, which is directed by GoPro’s founder and CEO, Nicholas Woodman, and by Jill R. Woodman. The trust owns 45 million class B shares, which are identical in value to class A shares, but each class B share gets 10 votes.
Nicholas and Jill Woodman will sell about 4.1 million shares from trust. The Silicon Valley Community Foundation is not selling shares. This may cause confusion, given the reports from over a month ago that the Woodman sales would not take place until next year, because the Silicon Valley Community Foundation has said it will not sell shares until 2015. Other major selling shareholders in this offering are Riverwood Capital, offering 1.63 million shares, and Foxteq Holdings, offering a million shares.
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GoPro’s shares have more than tripled since their June initial public offering (IPO) of 20 million shares at $24. Shares closed down Wednesday almost 6% at $79.09, but after the company announced the pricing for this offering, shares in the premarket on Thursday dipped another 6% to $74.30.
There are a couple of ways to think about this. Some investors will think this was too large a discount and that insiders are just getting even richer. The other side is that investors who missed the GoPro bandwagon may feel that this gives them an opportunity to buy on a serious pullback — after all, GoPro stock has now lost almost a quarter of its value from the peak, and its stock price was down $10 in just two trading sessions.
The stock has a consensus analyst price target of $81.60 and a post-IPO trading range of $28.65 to 98.47. The market cap is nearly $10 billion.
Here is GoPro’s Use of Proceeds from the filing, and it is unusually long:
We estimate that we will receive net proceeds of $97.1 million from the sale of the 1,287,533 shares of Class A common stock that we are selling in this offering, assuming a public offering price of $79.15 per share. … We will also receive proceeds of $2.3 million from the exercise of stock options by certain selling stockholders in connection with this offering. We will not receive any proceeds from the sale of shares of our Class A common stock by the selling stockholders.
The principal purposes of this offering are to raise additional capital, facilitate an orderly distribution of shares for the selling stockholders in this offering and increase our public float. We expect to use the net proceeds of this offering for general corporate purposes including working capital. We may also use a portion of the net proceeds to acquire or invest in complementary businesses, technologies or assets. However, we have no present commitments or agreements to enter into any acquisitions or make any investments.
Our management will have significant flexibility in applying the net proceeds from this offering, and investors will be relying on the judgment of our management regarding the application of these net proceeds.
Pending the uses described above, we intend to invest the net proceeds from this offering in short-term, interest-bearing obligations, investment-grade instruments, certificates of deposit or direct or guaranteed obligations of the U.S. government. The goal with respect to the investment of these net proceeds will be capital preservation and liquidity so that these funds are readily available to fund our operations.
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