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International Market Centers launches $160 million IPO

NEW YORK — International Market Centers, a Bain Capital/Oaktree Capital-backed owner of showroom space and exhibition pavilions, launched a roughly $160 million IPO that will allow it to repay debt.

The deal is expected to price after the market close on May 7.

IMC, an internally managed real estate investment trust (REIT), is offering 11.5 million shares at $12-$14 each.

The REIT plans to pay a distribution starting at 19.5 cents a quarter, annualizing to a 6 percent yield at the mid-point of the IPO range.

About $125.5 million of the proceeds will be used to repay and terminate a second-lien term loan facility, while $9.3m will be paid as fees to Bain and Oaktree.

The REIT owns 12.1 million gross square feet of showroom space across 14 buildings in High Point, N.C., and three buildings and three exhibition pavilions in Las Vegas

The showrooms are mainly leased by home furniture and decor product suppliers. The facilities host semiannual “markets” or weekly business-to-business trade gatherings.

IMC last year generated an 8 percent increase in total revenues of $162.8 million and a net loss of $29.6 million, though one reason for the loss was costs associated with $500 million of long-term debt.

The buildings were placed into receivership in 2009 and 2010 before they were purchased by Bain and Oaktree in 2011.

Deal sources described the REIT as the first of its kind.

The showroom space is leased to tenants under multi-year leases, even though they display only a couple of times a year.

Investors are lining up the company against comps Gaming and Leisure Properties, Correction Corp. of America, and Geo Group, the source said.

Barclays, Credit Suisse, Wells Fargo, Deutsche Bank and JP Morgan are joint bookrunners.

IMC plans to list on the NYSE under the symbol “IMC.”

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