Noodles & Co., the restaurant chain that serves pastas and soups in 26 U.S. states, more than doubled in its first day of trading after pricing its initial public offering above an increased price range.
The shares surged to $36.75 as of 4 p.m. in New York after Noodles sold 5.36 million shares yesterday for $18 each. The company had earlier increased its proposed price range to $15 to $17 from $13 to $15, filings show.
Noodles is the first company to double in a U.S. IPO trading debut since April 2012, when Splunk Inc., the web-analytics software maker, surged 109 percent in its first day, data compiled by Bloomberg show. Noodles gained after the Standard & Poor’s 500 Index this week posted its first three-day gain in more than a month, recovering from a selloff spurred by concern the U.S. may curb economic stimulus measures.
“We’ve been delivering some of the best results in the restaurant industry in the last five years, and the market understands that and respects that,” Chief Executive Officer Kevin Reddy said in a telephone interview today. Investors “recognize the tremendous white space and growth that we have.”
Noodles, based in Broomfield, Colorado, raised $96.4 million in its IPO and planned to use proceeds to reduce long-term debt. The company sold stock equivalent to a 19 percent stake in the offering, while Catterton Partners, the private-equity firm that purchased Noodles in December 2010 for an undisclosed amount, planned to retain a 37 percent stake following the sale, filings show.
Noodles, founded in 1995, is the first restaurant company to complete a U.S. public offering this year, according to data compiled by Bloomberg.
Morgan Stanley and UBS AG led the offering. The shares are listed on the Nasdaq Stock Market under the symbol NDLS.