SmileDirectClub yesterday set the pricing range on an initial public offering that could fetch up to $1.5 billion.
Nashville, Tenn.-based SmileDirectClub produces 3D-printed clear dental aligners designed to provide an alternative to traditional braces. It boasts affordable orthodontic solutions, comparing its price of less than $2,000 to the $5,000 to $8,000 charged for traditional braces.
SmileDirectClub is offering 58.5 million shares of its Class A common stock for $19 to $22, for gross proceeds of about $1.1-$1.3 billion, according to an SEC filing.
The company said it will earmark $493.4 million of the net proceeds — or approximately $664.4 million if the option to purchase additional shares is exercised in full — to purchase limited liability company units of its subsidiary, SDC Financial, as well as shares of common stock from existing shareholders.
SmileDirectClub plans to list on the NASDAQ Global Select Market under the “SDC” symbol. J.P. Morgan, Citigroup, Bank of America, Merrill Lynch, Jefferies, UBS Investment Bank, Credit Suisse, Guggenheim Securities, Stifel, William Blair and Loop Capital Markets are expected to deliver the shares.
In a March arbitration hearing, SmileDirectClub won a decision that forced Align Technology (NSDQ:ALGN) to close its InvisAlign retail stores after an arbitrator decided that Align breached a non-compete contract with SmileDirectClub and “misused the SDC Entities’ confidential information and violated fiduciary duties” to SmileDirectClub.
In April, CVS (NYSE:CVS) announced a deal to launch SmileDirectClub SmileShops within hundreds of CVS pharmacies over the course of the year. SmileDirectClub’s website lists 92 SmileShop locations at CVS stores in 22 different states.