Boise Cascade Co., a U.S. producer of wood products used in home construction, surged as much as 24 percent after raising $247 million in an initial public offering that priced above an increased range.
The shares advanced 22 percent to $25.65 at 9:46 a.m. in New York after earlier rising as high as $26. The Boise, Idaho- based company yesterday sold 11.8 million shares, about a 28 percent stake, for $21 each, after offering them for $18 to $20. Boise raised the range after originally setting it at $16 to $18, regulatory filings show.
Boise completed its IPO after U.S. new-home starts in December jumped 12 percent from the previous month to the highest level since June 2008. The company benefited after U.S. stocks rallied, with the Dow Jones Industrial Average marking its best January since 1994 as U.S. lawmakers agreed on a budget compromise and companies from Mead Johnson Nutrition Co. to Whirlpool Corp. reported earnings that beat analysts’ estimates.
Madison Dearborn Partners LLC, the Chicago-based private equity firm, continues to control Boise after the IPO, according to regulatory filings. The company was formed in 2004 from Madison Dearborn’s acquisition of OfficeMax Inc.’s forest products and paper assets.
Boise plans to use $25 million from the sale to repay debt under its revolving credit facility, according to its prospectus. The remainder will be used for general corporate purposes.
The company operates 18 wood-product factories and 31 distribution centers, making such products as plywood sheathing and laminated-veneer lumber. Boise had earnings before interest, taxes, depreciation and amortization of $80.1 million on sales of $2.63 billion in the 12 months through Sept. 30, filings show.
Bank of America Corp. and Goldman Sachs Group Inc. led the offering. The shares are listed on the New York Stock Exchange under the symbol BCC.
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