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IPO Report: Market rout casts cloud over biggest IPO of the year as at least two deals are pulled during brutal selloff

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At least two initial public offerings were withdrawn during Tuesday’s brutal stock market rout, casting a shadow over the year’s biggest deal, a $1.68 billon offering from AIG’s life insurer Corebridge Financial Inc.

Israel tech-focused special-purpose acquisition corporation Keter1 Acquisition withdrew its plans for an $250 million IPO on Tuesday, according to Renaissance Capital, a provider of pre-IPO institutional research and IPO-focused ETFs.

And cancer-focused biotech Elicio Therapeutics pulled its $40 million offering, according to Renaissance.

The decisions came as the Dow Jones Industrial Average
DJIA,
+0.10%

shed 1,300 points Tuesday to mark its worst one-day performance since June 11 of 2020, following an unexpectedly hot consumer-price inflation reading for August.

The S&P 500 shed 4.3%, while the Nasdaq Composite
COMP,
+0.74%

fell 5.2% in a broad-based selloff. All 11 S&P 500 sectors finished in the red after the August consumer-price index, or CPI, rose 0.1% in August. Though the year-over-year rate slowed to 8.3% from 8.5% in July, economists had been looking for a monthly fall of 0.1% that would bring the year-over-year rate down to 8%.

Corebridge priced its deal late Wednesday at $21 a share, the low end of a range that topped at $24 a share. Corebridge offered 80 million shares to raise the most of any deal in this year’s frozen market. It had hoped to raise as much as $1.8 billion.

For more, see:This AIG spinoff is the biggest IPO of the year at just $1.8 billion in a sign of the deep freeze in new offerings

To be sure, Corebridge had some points in its favor, not least being that it’s profitable and has delivered solid growth. Corebridge had net income of $6.4 billion in the first half of the year on revenue of $16 billion, according to its filing documents. That was up from net income of $2.8 billion in the year-earlier period, on revenue of $11.02 billion.

The company is planning to pay quarterly dividends, offering a 4.1% annualized yield at the midpoint of its range, according to Renaissance co-Founder and CEO Bill Smith. It had $358 billion in client assets as of June 30.

The deal
CRBG,

had a strong roster of underwriters at 43 banks, with JPMorgan acting as lead. It will start trading on the New York Stock Exchange later Thursday under the ticker “CRBG.”

Linkbancorp Inc.
LNKB,
+0.67%
,
which operates Pennsylvania-based The Gratz Bank, priced its public offering on Tuesday at $7.50 a share, below its price range of $8.00 to $9.50. That offering was an uplisting to the Nasdaq from the OTC market. The stock was up 2.4% in recent trades.

Also on the docket Wednesday was biotech Third Harmonic Bio. THRD The company specializes in treatments for allergic and inflammatory diseases. It priced its IPO at $17 a share, the midpoint of a $16 to $18 price range. The company upsized the deal to 10.9 million shares from an earlier plan to offer just 9 million, raising $185.3 million. The stock will start trading on Nasdaq later Thursday, under the ticker “THRD.”

The Renaissance IPO ETF
IPO,
+1.92%

has fallen 43% in the year to date, while the S&P 500
SPX,
+0.34%

has fallen 17%.

Read now: You bought. They sold. Meet some of the insiders who unloaded $35 billion in stock amid the tech IPO bonanza before it tanked.

The Moneyist: ‘I hate to be cheap’: With 40-year high inflation, is it still acceptable to arrive at a friend’s house for dinner with just one bottle of wine?

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