ASV Holdings hits the dirt at IPO open
ASV Holdings is a subsidiary of Terex International that specializes in making loader equipment. ASV Holdings was formed as one of many firms to deal in loader equipment, with its sister companies being Polaris and snowmobile manufacturer Arctic Cat. SV holdings sells its products under three labels namely ASV, CAT, and Terex.
The Grand Rapids, MI-based company, is one of the largest track and skid steer makers in the US. ASV Holdings boasts of over 130 retailing locations in the US alone. The company also operates in Canada, Australia, and New Zealand.
One of the first things ypu’ll notice about ASV Holdings is that all the equipment designs it issues are patented. That means there’ll be no companies knocking on its doors in future claiming that ASV Holdings stole their intellectual property. Secondly, ASV Holdings makes some fantastic products. For example, the company makes rubber soles that are good for all types of terrains. The soles’ good grip makes them a favorite among automobile manufacturers that make and sell snowmobiles and four-wheel-drive SUVs. Similarly, ASV Holdings uses patented undercarriage tech that helps automobile manufacturers make cars suitable for all weather conditions. The demand for ASV Holdings products is thus an all-year-round thing.
According to CEO Andrew Rooke, the ASV Holdings IPO would make the firm better by improving its accountability. Rooke has headed ASV Holdings since it started. His peers know him for his experience and ability to deliver, which should have been a positive factor in ASV Holdings’ eventual IPO success. By making the company public, Rooke noted, the management would be making it open to more public scrutiny. ASV Holdings could, therefore, be able to improve its products with input from public shareholders as well as from other investors. Similarly, an ASV Holdings IPO would increase its creditworthiness, open up avenues for further capital input and improve its visibility to the public eye. As people learnt more about the company they would be more receptive to its products.
For a company that brought in $103.8 million in net sales in the fiscal year that ended on December 31st, 2016, ASV Holdings’ proceeds were disappointing. The firm sold 1.8 million of its common shares in the IPO. Selling shareholders such as majority shareholder Manitex International put up an additional 2 million of common stock in the deal. ASV Holdings ended up selling all these shares at $7 each which was notably beneath its $8 to $10 initial pricing range. At midpoint of the initial price spectrum, ASV Holdings would have had a market capitalization of $69 million. The company’s market value remains unknown at this point. That’s because it’s waiting for insiders to exercise the 570,000 share over-allotment option that it had as part of its offering. The insiders in question are Roth Capital and Seaport Global Holdings.
ASV Holdings shares will be on the NASDAQ stock market under the label ASV until May 17th, 2017. With the current shares trading at $7.85, the company approximates that its IPO proceeds will total to $10.7 million minus all expenses. This proceeds will pay off ASV Holdings’ outstanding debt.