A credit card is used at a store in Calgary.Todd Korol/The Globe and Mail
CPI Card Group, a Canadian-owned, U.S. credit card maker has raised $150-million (U.S.) in an initial public offering– about half the amount it had originally targeted, the firm said on Thursday in a filing with the Securities and Exchange Commission (SEC).
The shares are expected to start trading on the Toronto Stock Exchange and the Nasdaq on Friday, a day later than previously planned.
Fifteen million shares were sold at $10, below the $12 to $14 range it had been hoping for.
Last year, Littleton, Colorado-based CPI produced 360 million cards for banks and credit card issuers, and counts JPMorgan Chase & Co., Bank of America, American Express Co. and Wells Fargo & Co. among its customers. CPI has operations in the United States, Britain and Canada.
The first signs of trouble for this IPO surfaced on Wednesday, when CPI cut back the amount of money it planned to raise to $200-million (U.S.) from $300-million.
"Due to heightened volatility in the market, CPI's IPO did not price as close to the offer as originally planned on Wednesday," said CEO Steve Montross in an e-mailed statement.
CPI Card Group is majority-owned by Vancouver-based private equity shop Tricor Pacific Capital Inc. Tricor purchased CPI for an undisclosed sum in 2007. Tricor is selling a portion of its shares in the IPO, but not as much as it had planned. Its stake will fall to 61.5 per-cent from 84-per cent. In a Sept. 22 SEC filing, Tricor had indicated that it would reduce its stake to 54.5-per-cent.
Among the other selling shareholders are Mr. Montross, who is cutting his stake to 2.8 per cent from 3.9 per cent, and directors Robert Clarke (2.1 per cent vs. 2.9 per cent) and James Galliher (1.9 per cent from 2.6 per cent).
BMO Nesbitt Burns Inc., Goldman Sachs Group Inc., and CIBC World Markets Inc. co-led the CPI stock sale.
Sentiment in the North American IPO market has downshifted since Labour Day.
Last week, Tricon Investment Partners Inc., a subsidiary of Toronto-based real estate management firm Tricon Capital Group Inc., pulled its planned $140-million IPO on the Toronto Stock Exchange, blaming "current adverse market conditions."