Houlihan Lokey Seeks Value of Up to $1.57 Billion in IPO

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Houlihan Lokey, the independent merger-advisory firm, is seeking a valuation of as much as $1.57 billion in an initial public offering.

Current investors are looking to raise up to $313 million by marketing about 13.1 million shares at $22 to $24 apiece, according to a regulatory filing Monday. The valuation is based on the 65.2 million shares that the company said will be outstanding after an IPO.

Houlihan Lokey and its advisers, Bank of America Corp. and Goldman Sachs Group Inc., are planning to price the IPO Aug. 12, according to data compiled by Bloomberg. Japanese financial firm Orix Corp. is planning to sell stock in the offering as are Houlihan Lokey Chief Executive Officer Scott Beiser, 56, and Executive Chairman Irwin Gold, 58. Los Angeles-based Houlihan Lokey won’t receive any of the proceeds.

“Investment bankers know better than anyone else when the IPO market is near a peak,” Erik Gordon, a professor at the University of Michigan’s business school, said in an e-mail. “They are selling at top dollar. Anything less would be a failing grade for a firm that makes its living advising companies when to sell.”

The firm, established in 1972, generates fees for advising on mergers and acquisitions, capital markets and restructuring transactions. In addition to working on deals like Priceline Group Inc.’s purchase of Kayak Software Corp., Houlihan Lokey has been an adviser on some of the largest bankruptcies in history, including Lehman Brothers Holdings Inc. and Enron Corp.

The company posted $681 million in revenue in the year through March 31, a 15 percent jump over 2014, the filing showed. Net income attributable to Houlihan Lokey was $79.9 million during the 2015 fiscal year.

Houlihan Lokey is among firms benefiting from merger and acquisition activity that is near a record pace this year. Beiser has been expanding his own operation through deals, announcing acquisitions recently that add retail, entertainment and media businesses.

The company plans to list its shares on the New York Stock Exchange under the ticker HLI.

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