In an SEC filing this morning, Grand Canyon Education sets its IPO terms. In the first indications, it looks like 10.5 million shares are being planned for sale in a range of $18.00 to $20.00 per share share. The company has the ticker of "LOPE" on NASDAQ.
It looks like 75% of the net proceeds will be used to pay existingshareholders in a special distribution. Grand Canyon will spend up to $16million to repurchase an outstanding warrant and the remainder will payfor filing and offering fees and general corporate purposes. Intoday’s volatile and weak stock market, that 75% of proceedsimmediately going out the door may get a little push-back from potentialIPO subscribers.
The company is a regionally accredited provider of online graduate and undergraduatedegree programs in education, business, andhealth care. At December 31, 2007, enrollment was approximately 14,800students, with about 85% enrolled in online programs and62% of students pursuing master’s degrees. Student enrollment wasapproximately 16,500 students at June 30.
Joint book-runners are Credit Suisse and Merrill Lynch& Co. (MER), and co-managers are listed as BMO Capital Markets,William Blair, and Piper Jaffray. The underwriters will have a 30-dayoption to purchase up to 1,575,000 additional shares of common stock at the public offering price to cover over-allotments if needed.
Revenue in 2007 was $99.326 million, with net income attributable tocommon shareholders of $1.177 million. For the first half of 2008,those figures were $70.275 million in revenue and $2.703 million netincome.
Jon C. Ogg
September 29, 2008
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