Gates Industrial Corporation Plc. is a global holding company with an interest in the manufacturing of engineered power transmission and fluid solutions. It offers products and services such as synchronous or asynchronous belts, which include Micro-V belts, CVT belts, and V-belts (United States Security and Exchange Commission, 2018). It also offers metal drive components and kits for stationary and mobile drives. The company was founded in 1911. Charles C. Gates.
Gates Industrial Corp. Plc. applied for an IPO in December 2017, making it officially a public entity. It began traded its first shares on the New York Stock Exchange market on January 25, 2018. The primary reason for the company to go public was to raise capital to service its outstanding loans that were increasingly piling-up (Gates Industrial Corporation plc, 2018).
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The firm chose to list and trades its shares on the New York stock market. The company preferred to list its stocks on NYSE because of its overwhelming history of trading with big companies and significant population size. The stock symbol is GTES mark representing its products and services.
The corporation chose Citigroup, UBS Investment Bank, and Morgan Stanley as the investment banker throughout the trading period. Citigroup, Stanley, and UBS are trustworthy and experienced bankers. The IPO was established based on an underwriting basis. The investment bankers got 42.1 million dollars and another 9.5 million dollars in offering expenses. Besides, Blackstone Advisory Partners L.P. was given $3.2 million as an underwriting fee. Therefore, bankers received 6.53% of the total aggregate offering price (United States Security and Exchange Commission, 2018).
The number of shares allotted totaled 38.5 million shares of the complete stock. On the other hand, insider ownership of the corporation is estimated to be about 0.2%, which translates to USD6.0 million (Simply Wall St., 2019).
The offer price per share was listed as USD19. It was decided from the daily comments from a variety of analysts who suggested it to be around 18 to 21 dollars, but the company settled on 19 dollars. Approximately a net of 789.6 million dollars was raised during the trade (Gates Industrial Corporation plc, 2018).
The firm's price of the stock has been changing; for instance, NYSE: GTES share prices nosedived by 51% in the past three months. At the end of the first day, its stock price stood at 19 dollars bringing about sales of up to 731.5 million dollars (Gates Industrial Corporation plc, 2018). The estimates of the underpricing were left standing at 5% of the shares. The current price is at 8.78 dollars, which is a drastic decrease due to the coronavirus effect on the stock market (Benoits, 2020).
When launching its IPO, GTES expected to raise $929 million but ended up raising $731.5 million. It also gave its underwriters an option of up to 30 days to purchase an extra 5. 775 million ordinary shares. It is interesting to note that GTES is a holding in 33 USA-traded ETFs with a 1.9 million share. Vanguard Small-Cap ETF (V.B.) is the biggest ETF holder of GTES (ETF.com, 2020).
References
Benoits, D. (2020). NYSE:GTES - Gates industrial stock price, forecast & news. Market Beat . https://www.marketbeat.com/stocks/NYSE/GTES/
ETF.com. (2020). ETFs with Gates Industrial Corporation plc . https://www.etf.com/stock/GTES
Gates Industrial Corporation plc. (2018). Gates Industrial Corporation Plc. announces pricing of initial public offering. Prnewswire . https://www.prnewswire.com/news-releases/gates-industrial-corporation-plc-announces-pricing-of-initial-public-offering-300587936.html
Simply Wall St. (2019). Industrial Corporation Plc. (NYSE:GTES) shares did insiders buy, in the last year? Yahoo Finance . https://finance.yahoo.com/news/many-gates-industrial-corporation-plc-110038586.html
United States Security and Exchange Commission. (2018). Annual report pursuant to section 13 or 15(d) of the securities exchange act of 1934. Gates Industrial Corporation Plc . http://d18rn0p25nwr6d.cloudfront.net/CIK-0001718512/a70b726b-f512-4dc4-abfc-ac94d1e6adec.pdf
