Sotera Health has filed with the SEC to confirm its intent to raise nearly $1.1 billion in an initial public offering.
Broadview Heights, Ohio-based Sotera Health said in the filing out yesterday that it expects to sell 46.6 million shares of its common stock at an assumed IPO price of $21.50 per share, totaling $949.3 million. However, if underwriters exercise their option to purchase additional shares in full, that total would reach $1.0917 billion.
Sotera Health said it intends to use a portion of the IPO’s net proceeds to redeem all outstanding aggregate principal amount of its second-lien notes, while also using some to repurchase nearly 1.7 million shares of its common stock from certain executive officers.
The remaining balance of the net proceeds of the IPO are earmarked for repaying a portion of the outstanding indebtedness under the company’s term loan. Additionally, some could be used in short-term, interest-bearing, investment-grade securities, the company said.
Analyst Donovan Jones wrote on Seeking Alpha that he believes the IPO is excessively priced for the company which he described as “growing slowly” and having “significant debt,” so he said he’s passing on it.
Sotera Health works with Sterigenics, Nelson Labs and Nordion to provide sterilization and lab testing services to medical device and pharmaceutical companies around the world.