Citigroup Inc.'s spinoff of its Primerica Inc. unit, a commission-based network of independent sales representatives selling life insurance and investment products, is one of four companies expected to go public this week as the market for initial public offerings appears positioned for a comeback.
Analysts are optimistic about most of this week's deals, especially as recent IPOs — most notably chip maker MaxLinear Inc. and portfolio manager and advisory firm Financial Engines Inc. — have been well-received by investors.
Many IPOs that have made it to market this year have largely had to accept lower prices for their shares due to a volatile stock market and worries about companies' debt loads, weak operating histories and slow growth. Those scheduled for this week, however, have little to no debt.
"This is a step in the right direction as we're moving away from deals with low revenue growth, losses and high debt that become fire sales," said IPO market tracker Scott Sweet of IPOBoutique.
The biggest name on the roster is Primerica, which Citigroup is divesting in an effort to simplify its operations and reduce debt. The New York bank has already sold its commodities trading unit, its Japanese brokerage and some credit card assets.
The bank hopes to raise $234 million for the unit by selling 18 million shares for $12 to $14 apiece. Citi will receive all proceeds from the stock sale.
Primerica has about 100,000 sales representatives selling life insurance and investment products like mutual funds. IPO followers say the Primerica offering should fare well because it's priced right. Many IPOs this year have stumbled in their debuts because competition between investment bankers inflated offering prices.
"This is one of Citigroup's last remaining gems," Sweet said. "They will do everything they can to make this deal work."
Primerica will trade under the symbol "PRI."
Investors appear most eager to invest in technology companies, analysts say. That's especially true after MaxLinear, a maker semiconductors used in products including TVs, cable boxes and PCs, posted double-digit gains on its first day of trading last week, despite a down day for the overall market.
MaxLinear's stock is trading more than 30 percent above its initial price of $14 apiece.
"The writing's on the wall for technology companies," said John Fitzgibbon of IPOScoop.com. "People go where good luck can happen."
That should benefit SS&C Technologies Inc., which makes software for automating computer functions at financial services firms. The Windsor, Conn. company, which plans to raise about $150 million by selling 10.7 million shares priced at $13 to $15, will trade under the symbol "SSNC."
Meanwhile, wireless network provider Meru Networks Inc. hopes to raise $61.4 million, selling about 4.4 million shares for $13 to $15 each. It will trade under the symbol "MERU."
Analysts aren't as confident about shipper Scorpio Tankers Inc., which expects to raise about $187.5 million. The shipping industry has been hurt by sluggish global demand for commodities like oil, cement and iron ore and coal.
Scorpio plans to sell 12.5 million shares for $14 to $16 each, and will trade under the symbol "STNG."
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