China Xiniya, Zogenix IPOs Raise $144 Million; Shares Retreat
China Xiniya Fashion Ltd. (XNY) sold its $88 million U.S. initial public offering at the top of the price range, while Zogenix Inc. (ZGNX), a developer of treatments for central nervous system disorders, raised $56 million.
China Xiniya, a designer of men’s business clothes in China’s Fujian province, sold 8 million American depositary receipts at $11 apiece, according to a filing with the Securities and Exchange Commission and data compiled by Bloomberg. San Diego-based Zogenix priced 14 million shares at $4 apiece after originally offering 6 million at $12 to $14.
The deals followed the biggest week for U.S. initial sales since March 2008, according to data compiled by Bloomberg. The IPO market has stabilized after 61 offerings were postponed or withdrawn this year, with companies from General Motors Co. (GM) to LPL Investment Holdings Inc. (LPLA) raising more than $17 billion combined last week as the Standard & Poor’s 500 Index (SPX) traded near a two-year high.
“You’re seeing a continuation of that confidence in the equity markets,” said Sean Kraus, who oversees about $2.2 billion as chief investment officer at Citizens Business Bank in Pasadena, California. Investors are “a little bit more comfortable with IPOs, even those that may not have been able to get done a few months ago,” he said.
The shares retreated as the S&P 500 slumped 1.4 percent today, after fighting broke out between North and South Korea and concern grew that Europe’s debt crisis and China’s efforts to tame inflation will slow the global economic rebound.
“It’s a sentiment-driven market right now,” said Josef Schuster, the Chicago-based founder of IPOX Capital Management LLC, which oversees $3 billion. “Investors are getting a little worried about what’s happening in domestic China.”
China’s government in the past month stepped up a campaign to limit credit expansion after inflation quickened and property prices surged. The country’s biggest banks are poised to hit government-set caps on lending and plan to stop expanding their loan books to avoid exceeding the annual quotas, according to four people with knowledge of the matter.
Chinese companies have posted five of this year’s twelve best performances among IPOs on New York exchanges this year, data compiled by Bloomberg show. The nation’s economy will grow 9 percent next year, more than three times as fast as the U.S., according to estimates compiled by Bloomberg.
ChinaCache International Holdings Ltd. (CCIH), the Beijing-based provider of content for business websites, had the biggest first-day rally on New York exchanges in three years, jumping 95 percent on Oct. 1, data compiled by Bloomberg show.
SouFun Holdings Ltd. (SFUN), the Beijing-based operator of China’s largest property website, surged 73 percent on Sept. 17 after selling its $125 million IPO at the top of the forecast range.
Cowen & Co. led China Xiniya’s offering. The designer and manufacturer of men’s business apparel and accessories will use proceeds from the IPO to build new manufacturing facilities, open stores and develop new products, the prospectus said.
Syswin Inc. (SYSW), a Beijing-based real estate agency, delayed its U.S. IPO scheduled for yesterday, data compiled by Bloomberg show. The company will now sell 9.6 million shares at $7 to $8 apiece after originally offering 12 million shares at $9.25 to $11.25, according to an SEC filing. New York-based Morgan Stanley (MS) is leading the offering, the prospectus said.
Wells Fargo & Co. (WFC) of San Francisco and Boston-based Leerink Swann & Co. arranged Zogenix’s sale. The company will use proceeds to fund clinical trials and the commercialization of its treatment for migraines, according to the SEC filing.
Zogenix, which had no revenue until this year, posted sales of $14.6 million in the first nine months of 2010, the filing said. The company’s net loss widened to $71.4 million from $39.7 million a year earlier.
GM of Detroit sold $15.8 billion of common shares last week in the second-largest U.S. IPO on record, data compiled by Bloomberg show. Boston-based LPL, the brokerage and investment advisory firm owned by TPG Capital and Hellman & Friedman LLC, raised $517 million including its overallotment option.
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