U.S. IPO market braces for nine deals this week, led by early-education provider KinderCare

By Ciara Linnane

List includes a Brazilian lubricants business and a medical-device maker using AI to track seizures

The U.S. initial public offering market is expected to welcome nine deals this week to raise about $1.4 billion, anchored by kindergarten operator KinderCare Learnings Cos. Inc. and Brazilian company Moove Lubricants Holdings.

That's according to Renaissance Capital, a provider of IPO exchange-traded funds and institutional research.

KinderCare (KLC) is expected to raise $600 million by offering 24 million shares at the midpoint of its range of $23 to $27. With about 118 million shares expected to be outstanding after it goes public, KinderCare would have a market capitalization of about $3 billion, making it one of the bigger deals of the year.

The Lake Oswego, Ore.-based company attempted to IPO in 2022 before pulling the deal. It's now planning to trade on the New York Stock Exchange under the ticker "KLC" after restructuring its business to shed poorly performing centers and seeking out better opportunities in attractive markets.

Goldman Sachs, Morgan Stanley, Barclays and JPMorgan are part of a team of 12 banks working on the deal.

KinderCare is backed by Swiss private-equity firm Partners Group Holding AG, which bought the company in 2015. KinderCare is hoping to benefit from the need for early childcare programs as women participate in the workforce in greater numbers.

The company reported $26.8 million in net income on revenue of $1.34 billion in the six months ending June 20, compared to $71.7 million in net income on revenue of $1.27 billion in the year-ago period.

In fiscal 2023, KinderCare earned $102.6 million on revenue of $2.5 billion.

Moove (MOOV) specializes in making and distributing lubricant products for a range of end markets, and has clients in the automotive, agricultural and industrial spaces. The company was formed by the acquisition of ExxonMobil's Brazilian lubricant business by Cosan SA in 2008.

That company is expected to raise $400 million, by offering 25 million shares priced at the midpoint of its $14.50 to $17.50 range. The company, which would have a valuation of about $1.8 billion, has applied to list on the New York Stock Exchange under the ticker "MOOV." Underwriters are led by JPMorgan and BofA.

The company had net income of $42.7 million for the first half of 2024, on revenue of $903.9 million.

The third biggest deal is expected to be that of UpStream Bio Inc. (UPB), a clinical-stage biotech developing treatments for inflammatory diseases, with an initial focus on severe respiratory disorders.

That company is aiming to raise $200 million by offering 12.5 million shares at the midrange of its $15 to $17 price range. The company has applied to list on Nasdaq under the ticker "UPB." The underwriters are JPMorgan, TD Cowen, Piper Sandler and William Blair. With 48.8 million shares expected to be outstanding once the deal closes, the company would have a valuation of $780.8 million.

The company is loss-making for now, with revenue of $1.15 million in the first half, which was down from $1.31 million in the year-earlier period.

The remaining deals are far smaller, although the calendar did see some new entrants emerge early Monday.

Among them, is Ceribell (CBLL), a medical device maker that uses the technology du jour, artificial intelligence, to monitor patient seizures.

The Sunnyvale, Calif.-based company set terms for its IPO earlier with plans to offer 6.7 million shares priced at $14 to $16 each. The company would raise $100.5 million at the midpoint of that range and score a valuation of $451.5 million.

Ceribell has applied to list on Nasdaq under the symbol "CBLL." BofA Securities and JPMorgan are joint bookrunners on the deal.

The company is loss-making, according to its filing documents, but it chalked up $29.7 million in revenue in the first six months of the year.

The company's Ceribell System, a point-of-care electroencephalography platform designed to address the unmet needs of patients in the acute care setting, uses AI-powered algorithms to enable rapid diagnosis for patients at risk of seizures.

The Renaissance IPO ETF IPO is up 12.5% in the year to date, while the S&P 500 SPX has gained 20%.

-Ciara Linnane

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10-07-24 1346ET

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