Retail

Burlington Shares Pop on IPO

IPO
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In an initial public offering (IPO) on Wednesday morning, Burlington Stores Inc. (NASDAQ: BURL) sold 13.3 million shares at an IPO price of $17 a share and quickly jumped 38% to trade around $23.45. The expected price range had been $14 to $16. Net proceeds from the offering total approximately $206 million. The underwriters have a 30-day option on 2 million additional shares.

The company is the parent of Burlington Coat Factory stores and was taken private in 2006 by Bain Capital for about $2.06 billion. Bain will retain ownership of approximately 80% of the outstanding shares.

Net proceeds from the offering will be used to redeem $170.6 million 9%/9.75% of senior notes due in 2018, an $11 million termination fee to an affiliate of Bain Capital and for other general corporate purposes.

Burlington Coat Factory owns 503 stores in 44 states and Puerto Rico. As a discount clothing retailer it competes with Ross Stores Inc. (NASDAQ: ROST) and TJX Companies Inc. (NYSE: TJX). The retailer filed for its IPO at about the same time as Neiman Marcus, but has beaten the luxury retailer to market.

Shares of Burlington are up about 37.7% at $23.43 after the first 40 minutes of trading this morning.

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