SecureWorks Quietly Enters the Market

SecureWorks Corp. (NASDAQ: SCWX) has now entered the market with its initial public offering (IPO). The company priced its 8 million shares at $14 per share, below the expected pricing range of $15.50 to $17.50. The offering is valued at up to roughly $112 million.

The underwriters for the offering are Merrill Lynch, Morgan Stanley, Goldman Sachs, JPMorgan, Barclays, Citigroup, Credit Suisse, RBC Capital Markets, UBS Investment Bank, Pacific Crest, Stifel, SunTrust Robinson Humphrey and William Blair.

Keep in mind that SecureWorks is currently an indirect wholly owned subsidiary of Dell and Dell’s ultimate parent company, Denali Holding. This parent company will own, indirectly through Dell and Dell’s subsidiaries, no shares of the outstanding Class A common stock and all outstanding shares of the Class B common stock. Voting power for these classes of shares has yet to be established.

SecureWorks is a leading global provider of intelligence-driven information security solutions exclusively focused on protecting clients from cyberattacks. It has pioneered an integrated approach that delivers a broad portfolio of information security solutions to organizations of varying size and complexity.
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These solutions enable organizations to fortify their cyber defenses to prevent security breaches, detect malicious activity in real time, prioritize and respond rapidly to security breaches and predict emerging threats. The solutions leverage SecureWorks’ proprietary technologies, processes and extensive expertise in the information security industry, which it has developed over 16 years of operations.

As of January 29, 2016, this company has served over 4,200 clients across 59 countries. Its success in serving clients has resulted in consistent recognition of this company as a market leader by industry research firms such as International Data Corporation and Forrester Research. Gartner has recognized SecureWorks as a leader in its “Magic Quadrant for Managed Security Services” from 2007 to 2015.

The company intends to use the net proceeds from this offering for working capital and other general corporate purposes, which may include financing growth, developing new solutions and enhancements to its current solutions and funding capital expenditures. SecureWorks also may use a portion of the net proceeds to make investments in, or acquisitions of, complementary businesses, services and technologies.

Shares of SecureWorks were last seen trading at $14.35. So far the range on the day is $13.50 to $14.58, and about 5 million shares had moved as of late Friday morning. Although the stock originally priced at $14.00, it actually entered the market at $14.25.