Shipping container company goes public

News was prepared under the information support of Online Daily Newspaper on Hellenic and international Shipping "Hellenic Shipping News".

30 Oct 2010

A North Jersey shipping container company raised $95 million in the equity markets as it went public Thursday and began trading on the New York Stock Exchange. SeaCube Container Leasing Ltd. in Park Ridge is among the world’s largest lessors of shipping containers with more than 500,000 units used on trains, trucks and ships.
SeaCube had sought to issue 7.5 million shares at $16 to $18 a share. Instead, the company sold 9.5 million shares Thursday at $10 apiece, raising $95 million in equity financing. The company trades under the ticker symbol BOX.
SeaCube is the third New Jersey company to go public in the last 12 months and was preceded by Aegerion Pharmaceuticals Inc. of Bridgewater and Vitamin Shoppe Inc. of North Bergen.
Reluctant institutional investors and a challenged shipping market likely compelled SeaCube to cut the price of its stock, said Scott Sweet, senior managing partner of IPO research firm IPO Boutique. SeaCube had to lower the stock price and raise dividends to convince investors to take a chance on a company whose success would require global trade to perk up.
"The economy has taken a mighty toll on cargo containers, and the whole dry bulk shipping area is basically dead right now," he said.
The U.S. IPO market has begun to show signs of rebounding after 54 companies had postponed or withdrawn sales this year.
SeaCube’s plan called for using proceeds from the initial public offering to repay $74 million in debt as well as finance working capital, investing in new containers and other "general corporate purposes," according to SeaCube’s IPO filings with the Securities and Exchange Commission.
SeaCube, founded in 1993 under a different corporate structure, reported $31.1 million in profit in 2007 and $30 million in 2008. Last year, it swung to a loss of $15 million, but SeaCube was in the black the first half of this year, reporting $14.5 million in net income as of June 30.
SeaCube’s IPO included 2.5 million common shares and 7 million secondary common shares by Seacastle Operating Company Ltd., an entity indirectly owned by private equity funds managed by an affiliate of Fortress Investment Group LLC, the company said in a statement.
Based at 1 Maynard Drive in Park Ridge and headed by Chief Executive Officer Joseph Kwok, the company employed 75 people and had seven offices in four countries as of June 30, according to regulatory filings.
The company’s assets include refrigerated containers that carry perishable cargo such as fresh and frozen produce, meat and fish; so-called dry containers for general manufactured goods; and portable diesel-fueled generators used to power the refrigerated containers.
In its IPO filing, SeaCube warned investors its earnings could be impacted by such risk factors as declining global trade, customers deciding to buy their own shipping containers instead of leasing them, and the fact that much of the company’s revenue — 61 percent — came from its 10 largest customers in the first half of this year.
The company did not respond to a request for comment Thursday afternoon.
Underwriters have a 30-day option to buy up to 950,000 additional shares; they can also purchase up to 475,000 additional shares to cover any excess demand. JPMorgan, Citigroup and Deutsche Bank Securities are the lead underwriters of the offering.
SeaCube’s stock climbed as much as 16.9 percent before closing at $11, a gain of 10 percent, with 4.9 million shares changing hands. Shares in the 310 companies tracked by Bloomberg News that have gone public in the past 12 months have increased on average of 16 percent.

Source: NorthJersey.com