U.S. Silica IPO Prices & Hits The Market (SLCA)

U.S. Silica Holdings, Inc. (NYSE: SLCA) is the only known initial public offering on the IPO docket for this Wednesday.  The company has priced its initial public offering of 11,764,705 shares at a price of $17.00 per common share.

The company calls itself the second largest domestic producer of commercial silica, which is a specialized mineral that is critical to the oil and gas proppants end market and a variety of attractive industrial and specialty products end markets.  Think of this as “frac sand.”

New investors need to be aware that the company itself is selling only 2,941,176 shares of common stock in this offering.  It is selling stockholders who are offering the other much larger figure of 8,823,529 shares of common stock. In short, only $42.5 million is going to the company and the company designated in its “use of proceeds” that $34.5 million will fund future capital spending that includes the building of the new resin coating facility and to pay the transaction fees and expenses.

The underwriting group is huge: Morgan Stanley, BofA Merrill Lynch, and Jefferies & Company are the joint book-running managers.  Simmons & Company, Dahlman Rose, BB&T Capital Markets, BNP Paribas Securities, Lazard Capital Markets, and Moelis & Company were all listed as the co-managers in this offering.

The overallotment shares will also come from the shareholders if it occurs.  These underwriters have an option to purchase up to an additional 1,764,706 shares from one of the selling stockholders.