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On their second trip to the equity markets, Dun & Bradstreet Holdings shares gained 15.2% in their trading debut on Wednesday.
Dun & Bradstreet (ticker: DNB) shares traded up to 17% higher than their initial public offering price of $ 22. The shares closed at $ 25.35.
The strong sample comes after the business analysis company raised $ 1.7 billion, more than expected. Dun & Bradstreet on Tuesday night increased the size of its IPO, selling 78.3 million shares at $ 22 each. That’s more than the 65.75 million shares at $ 19 to $ 21 each that he had planned to offer. Underwriters of the deal include Goldman Sachs Group (GS), BofA Securities, JPMorgan Chase (JPM) and Barclays (BCS).
“I am spectacularly happy with the IPO,” said Stephen Daffron, president of Dun & Bradstreet. “It is a perfect meeting of a company with great data to offer and demand of a customer base that needs great data to make better data-driven decisions.”
At $ 1.7 billion, Dun & Bradstreet’s offering is the largest technology IPO so far this year, according to IHS Markit. Dun is also the largest tech offering since iQIYI (IQ), a Chinese online video platform, went public in 2018, raising $ 2.4 billion that year, the business information provider said.
Dun & Bradstreet of Short Hills, NJ provides data and analytics to approximately 135,000 customers, including 90% of the Fortune 500.
The Covid-19 pandemic increased the need for data, Daffron said. Barron’s. Before the virus, companies could obtain information when their executives attended trade shows or went out for drinks, he said. Covid-19 caused millions of American companies to close to stop the spread of the virus, ending those meetings. There is a shift from face-to-face meetings to digital and virtual experiences. Companies must rely on accurate data and analytics to be more effective, especially when it comes to marketing and sales, he said.
Companies still need information on the companies they may want to work with, as well as the suppliers they are already working with, he said. The coronavirus has also made small and medium-sized businesses more sensitive to supply chain problems, Daffron said. “Customers are knocking on our door,” he said. “They must insist on making data-driven decisions.”
The IPO is the last for Dun & Bradstreet as a public company. In 2018, Chinh Chu, a former senior managing director of the Blackstone Group (BX) where he co-led the private equity group, led a consortium of investors to buy Dun & Bradstreet in a $ 6.9 billion deal. The transaction closed in February 2019. The investor group included Thomas H. Lee Partners, Bill Foley’s Cannae Holdings, Black Knight and Chu’s investment firm CC Capital. The deal included a capital commitment of approximately $ 2 billion, according to a 2018 SEC filing.
Dun & Bradstreet sought to go public because they wanted to reduce their debt. The data company is highly leveraged, with $ 4 billion in long-term debt as of March 31.
“We will pay the debt first,” said Daffron. This will improve cash flow, which Dun & Bradstreet plans to use to grow their business, he said. Daffron expects growth to come organically from new products, as well as mergers and acquisitions. Dun has completed three hidden acquisitions since he went private in 2019, including Lattice, Orb, and coAction.com. Future purchases could include data and software companies, Daffron said.
CC Capital, Cannae and Black Knight also agreed to invest $ 400 million in Dun through a private placement right, according to an SEC filing. Daffron said the transaction has been closed.
Dun & Bradstreet’s IPO is not publishing the giddy performance of other companies like Vroom (VRM), an online used car salesman who raised $ 467.5 million. Vroom increased 117% on its first day of trading on June 9. Offering databases used by sales and marketing teams, ZoomInfo Technologies (ZI) raised nearly $ 1 billion with its IPO last month. ZoomInfo doubled on its debut, which was also on June 9.
Dun & Bradstreet, 179, founded in 1841, is much older and its IPO is much larger than these companies. His IPO means that “investors are looking for good companies to invest in and there is a lot of dry dust,” Daffron said.
Write to Luisa Beltrán at [email protected]
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