SunCoke Climbs 6.3% in Debut After IPO Raises $185.6 Million
SunCoke Energy Inc., the metallurgical coke-producing unit of Sunoco Inc. (SUN), climbed 6.3 percent after it raised $185.6 million in an initial public offering.
SunCoke, rose $1 to $17 at 4:15 p.m. in New York Stock Exchange composite trading after gaining as much as 13 percent to $18. About 11.6 million shares were sold at $16 each, SunCoke said today in a statement. That was the midpoint of the price range it sought.
Sunoco, a Philadelphia-based petroleum refiner, expects to pare its SunCoke stake to 83 percent after the offering. SunCoke, the biggest independent producer of metallurgical coke in the Americas, won’t receive any proceeds from the IPO.
The coke is used as a fuel for steelmaking and to reduce the metal’s oxygen content. SunCoke, which sells coke to ArcelorMittal and AK Steel Holding Corp. in the U.S., signed an agreement in May to take a minority stake in India’s Global Coke Ltd. for $30 million.
“Further deals like that could be under consideration,” Chief Executive Office Fritz Henderson said today in an interview on Bloomberg Television’s “InBusiness with Margaret Brennan.” “Outside of the U.S. we see good growth.”
SunCoke tapped the bond market yesterday, selling $400 million of debt maturing in August 2019, according to data compiled by Bloomberg. The company was seeking $450 million in loans to support the separation from Sunoco, two people with knowledge of the matter said last month.
Net income declined 87 percent to $5.7 million in the three months through March 31 as revenue increased 1.5 percent to $333.3 million, according to a filing with the Securities and Exchange Commission.
----With assistance from Margaret Brennan, Sapna Maheshwari, Krista Giovacco and Lee Spears in New York. Editors: Simon Casey, Steven Frank.
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