With every passing day, indications grow that the new offering market has reopened for business.
In the latest example, ZoomInfo Technologies (ZI) late Wednesday priced an initial offering of 44.5 million class A common shares at $21, giving the company a valuation of about $8.2 billion. (Note that ZoomInfo has no connection to Zoom Video Communications [ZM], the red-hot videoconferencing company.)
The stock is expected to open for trading within a few hours of the market opening on Thursday.
A Vancouver, Wash.-based provider of databases used by sales and marketing teams, ZoomInfo is controlled by a group of private-equity investors, including TA Associates, Carlyle Group, and 22C Capital. ZoomInfo plans to trade on Nasdaq under the symbol ZI. J.P. Morgan and Morgan Stanley are leading the underwriting group for the offering.
ZoomInfo had originally projected a price range of $16 to $18 a share, then raised the range on Tuesday to $19 to $20 a share.
The strong early reception follows a strong first day of trading for Warner Music Group (WMG), which came public on Wednesday at $25 a share and then spiked 20% on the first day of trading to close at $30.12. Late last month, the online insurance broker SelectQuote (SLQT) came public at $20 a share, and lately has been trading above $28.
After the offering, the current ZoomInfo ownership group—the private-equity firms and various insiders, including CEO Henry Schuck—will together have 89.6% of the combined voting power. The company noted in its S-1 filing with the Securities and Exchange Commission that Fidelity Investments, Dragoneer Investment Group, and BlackRock have agreed to buy up to $100 million of stock each at the offering price.
The current version of ZoomInfo reflects the September 2019 merger of a previous Boston-based company of the same name with DiscoverOrg, a software company in Vancouver, Wash., that was founded by Schuck in 2007 and later backed by TA and Carlyle, among other investors. Terms of the merger weren’t announced.
ZoomInfo describes itself in the S-1 as ”a leading go-to-market intelligence platform for sales and marketing teams.” The company said its cloud-based platform “provides highly accurate and comprehensive information on the organizations and professionals they target.” ZoomInfo says it has data on 14 million companies, with 202,000 paid users.
For 2019, ZoomInfo reported revenue of $293.3 million, almost double the $144.3 million in the year-earlier period, and a loss of $78 million, compared with a $28.6 million loss a year earlier. For the March quarter, ZoomInfo reports revenue of $102.2 million, up from $54.6 million a year earlier, with a loss of $5.9 million, versus a loss of $40.2 million in the year-ago quarter.
On the topic of the Covid-19 pandemic, the company said in the S1 that it has seen “an increase in potential customers seeking lower prices or other more favorable contract terms and current customers attempting to obtain concessions on the terms of existing contracts, including requests for early termination or waiver of payment obligations, all of which has adversely affected and could materially adversely impact our business, results of operations, and overall financial condition in future periods.”
Write to Eric J. Savitz at eric.savitz@barrons.com
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June 04, 2020 at 10:00PM
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ZoomInfo Prices IPO at $21 a Share, Above Expected Range - Barron's
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