Roots Lowers Price of Canada IPO to C$12 a ShareBy
Company planned to price shares between C$14 and C$16
Roots still raises C$200 million in initial share sale
Roots Corp., the Canadian retailer known for its casualwear and leather goods, raised C$200 million ($160 million) in its initial public offering after cutting the price below its targeted range, according to people familiar with the matter.
The Toronto-based retailer sold shares at C$12 a piece, below its previously disclosed range of C$14 to $16 each, said the people who asked not to be identified because the matter is private. The company still raised C$200 million after selling shareholders increased the amount of shares offered, they said.
The company is expected to begin trading on the Toronto Stock Exchange under the symbol ROOT next week.
The IPO comes two years after the company agreed to sell a majority stake to New York-based private equity firm Searchlight Capital Partners. It follows on the successful IPO of other Canadian consumer stocks in recent years, including Canada Goose Holdings Inc., whose shares have risen more than 50 percent since their March debut.
Founded in 1973 by Michael Budman and Don Green, Roots has more than 200 retail stores in Canada, the U.S., China and Taiwan, selling products that seek to capture the essence of the Canadian outdoors.
Roots said in a regulatory filing it sees ample room for growth by expanding its e-commerce presence and opening new brick-and-mortar stores. It plans to open as many as 10 new stores in Canada by the end of fiscal 2019, and as many as 14 in the U.S., including in cities like Boston, Philadelphia, Detroit, Washington and Chicago.
The retailer is planning as many as 25 additional stores in China and Taiwan over the same period, and has identified 12 additional international markets for expansion, including Singapore and Malaysia, the filing shows.
Roots said it plans to expand its leather goods and footwear offerings to help drive growth as well.
The company will receive none of the proceeds from the share sale, the filing shows.
The IPO is being led by Toronto-Dominion Bank, Credit Suisse Group AG and Bank of Montreal.
Business News Network earlier reported that Roots had cut its IPO price.