LifeLock is supposed to be a hot and anticipated initial public offering. It was not one of our top 17 IPOs to watch out for in 2012 but it easily could have been. LifeLock is the leading provider of proactive identity theft protection services for consumers and identity risk assessment and fraud protection services for enterprises. Now we have seen the terms set for its IPO.
The company itself is offering 15,500,000 shares of common stock, and selling stockholders are offering an additional 200,000 shares of common stock. The price per share has been set in a range of $9.50 and $11.50, and LifeLock shares are intended to trade on the New York Stock Exchange under the symbol LOCK.
The underwriting syndicate includes Goldman Sachs, BofA Merrill Lynch and Deutsche Bank Securities as the lead underwriters, and co-managers are listed as RBC Capital Markets, Canaccord Genuity and Needham & Company. If the overallotment is exercised in full then the total shares eligible for sale as of now are 18,055,000 shares.
Venture backers include Bessemer Ventures (23.8%), Kleiner Perkins Caufield & Byers (11.8%) and Industry Ventures (10.3%), and key stakes are held by Goldman Sachs Group Inc. (NYSE: GS) at 11.2% and Symantec Corp. (NASDAQ: SYMC) at 8.3%.
LifeLock claims to have a predictable subscription revenue model with high customer retention rate and a scalable infrastructure. Revenue was $193.9 million in 2011, but its sales are growing as the revenue for just the first six-months of 2012 was $125.5 million. The company recorded a net loss of $4.3 million for the year ended December 31, 2011. Its net income was $11.6 million for the six months ended June 30, 2012, but this included a $14.3 million income tax benefit resulting from its acquisition of ID Analytics. LifeLock’s filing showed that it generated cash flow from operating activities of $24.3 million during 2011 and $23.1 million during the six months ended June 30, 2012.
If the IPO goes off at the mid-point of the range, say at $10.50 per share, then the number of outstanding shares of 83,379,068 shares after the offering would generate a market cap of roughly $875 million.
JON C. OGG