Shares of Bats Global Markets Inc. have been witnessed to rally in their market debut through its own exchange. The rally appears to be a redemption following a botched effort to go public in 2012 and the market responded positively after a sluggish first quarter.
The stock has jumped 21% to $23 during Friday's closing and thus market value of the company reached to $2.2 billion. However, the estimation doesn't cover any extra share that underwriters may sell following initial public offering (IPO). The Wall Street Journal reports that the shares have been witnessed to start rolling at $22.88, which is 20% above the IPO value.
The offering has been expected to raise $252.7 million at an anticipated price range of $17-$19 a share. Thus, the fund has been predicted to be the largest one in the U.S.-based IPO market. However, all the transacted shares of Friday's trading have been offered by the shareholders while no fund has been raised by Bats, the second largest U.S. exchange by volume, according to a report published in Reuters.
A series of negative factors have forced Bats to withdraw its IPO shortly after the stock started to trade in 2012. Market value of the company has been estimated at $760 million during that phase of the IPO.
Besides other factors, Bats has been compelled to withdraw its IPO in 2012 following attacks of software bug. The IPO turmoil has eventually challenged Bats's reputation as an exchange operator, while being charged with the responsibility to ensure swift and efficient trading of equities and other products, reports The New York Times. Bats has generated $1.78 billion in revenue during last year. The revenue appears to have doubled compared to that posted four years earlier. During the same period, the company has been able to nearly quadruple their net income. Financial IPOs are less lucrative compared to other industries in a starving IPO market. But timing seems to be better for the Bats IPO, cites Gene Novak, a research analyst at Nuveen Asset Management. Few analysts predict Bats to reinvigorate the IPO market on its own. Combined success from other planned IPOs may be an encouraging sign for new offerings. American Renal Associates Holdings and SecureWorks Corp. are among others to go public shortly.
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