Lyntris and some of its existing stockholders raised US$297.5 million in a downsized U.S. IPO after pricing the shares below the marketed range, the defense contractor said on Tuesday. The Falls Church, Virginia-based company priced its initial public offering of 17 million shares at US$17.50 each. The company and its shareholders had initially marketed 24 million shares at US$19 to US$22 each. Lyntris, which makes battlefield sensors and software for the U.S. and its allies, is the latest in a wave of defense companies that have sought to list their shares in New York since April as boardrooms look to seize the opportunity created by the Iran war. The company sold about 5.7 million shares in the IPO, more than its earlier proposal of about 4.9 million shares, while existing shareholders cut their offering by more than 7.8 million shares. Several companies have trimmed deal sizes this year as the IPO rebound remains fragile, with investors still cautious on valuations. Defense companies need to show sustainable growth from core products, not one-off programs, to win over investors, said Matt Kennedy, senior strategist at Renaissance Capital, a provider of IPO-focused research and ETFs. “Because LYNX’s debt is so high, the company will also need to demonstrate it can pay that down over time,” Kennedy added. The company had long-term debt of US$272 million as of June 30. It is involved in more than 200 active defense programs, with no individual program accounting for over 7 per cent of revenue, according to its prospectus. Lyntris reported a net loss of US$13 million on revenue of US$241 million in the six months ended June 30, compared with a net loss of US$9.7 million on revenue of US$179.1 million a year earlier. Evercore ISI, Citigroup and Guggenheim Securities were lead book-running managers. Lyntris will begin trading on the NYSE under the symbol “LYNX” on Wednesday. (Reporting by Arasu Kannagi Basil and Sathvi G Bhat in Bengaluru; Editing by Shinjini Ganguli, Janane Venkatraman and Tasim Zahid)
