Upcoming CDW IPO Gets Some Shrinkage
ThinkstockThe upcoming initial public offering of CDW Corporation appears to be still be on track, with some twists. The computer and hardware seller has lowered its expected price range due to market conditions. It also appears that the private equity…
The upcoming initial public offering of CDW Corporation appears to be still be on track, with some twists. The computer and hardware seller has lowered its expected price range due to market conditions. It also appears that the private equity backers will not be bailing out as fast as the first filing showed.
CDW was initially slated to raise up to around $750 million. The new mid-point of the range signals 23.25 million shares at a range of $17 to $18 per share, versus a prior range of $20 to $23 per share. This comes to almost $407 million at the mid-point. The book-runners are listed as J.P. Morgan, Barclays and Goldman Sachs.
Private equity giants Madison Dearborn Partners and Providence Equity Partners took CDW private in a leveraged buyout for more than $7 billion back in 2007 during the private equity bubble. CDW managed to grow since then and it may be just one of the other large thorns in the side of Best Buy Co. Inc. (NYSE: BBY) while still being able to compete handily against Amazon.com Inc. (NASDAQ: AMZN).
As far as the use of proceeds, several uses were listed. CDW intends to use some $354.8 million to redeem $175.0 million aggregate principal amount of senior secured notes and $156.0 million aggregate principal amount of senior subordinated notes and redemption premia of $14.0 million and $9.8 million. And it will use $13.1 million of cash on hand or borrowings under the ABL facility to pay accrued and unpaid interest.
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Jon Ogg has been a financial news analyst since 1997. Mr. Ogg set up one of the first audio squawk box services for traders called TTN, which he sold in 2003. He has previously worked as a licensed broker to some of the top U.S. and E.U. financial institutions, managed capital, and has raised private capital at the seed and venture stage. He has lived in Copenhagen, Denmark, as well as New York and Chicago, and he now lives in Houston, Texas. Jon received a Bachelor of Business Administration in finance at University of Houston in 1992. www.247wallst.com.
