LoanDepot became the fourth out of four mortgage company initial public offerings launched in recent months to downsize, but that did not deter investors from driving the price straight up.
The offering ultimately consisted of 3.85 million shares at $14 per share; with an underwriters' option to purchase an additional 577,500 shares. The IPO included 2.394 million shares sold by loanDepot for proceeds of $25 million.
The remaining 1.456 million shares were sold by Parthenon Capital Partners
In its
Still, the stock quickly shot up with a high of $17.77 per share when it started trading on Thursday morning; by 1:30 p.m. it backed down to $17.05. But in the last half hour of trading the price leaped to a high for the day of $23.49 before closing at $22.09.
The loanDepot transaction came two weeks after
Both Rocket Cos. and Guild Holdings had also downsized their offerings before launching their IPOs. Because UWM Holdings went public in a merger with
A request for comment from loanDepot regarding the decision to pare the offering down was not returned.
However, in November 2015, loanDepot halted its planned offering at the brink of pricing, with some speculating at the time that the deal was going to fall below the $16 to $18 per share it was seeking.
This week’s reduction in the offering size affected loanDepot's plans for the use of its proceeds. It will now purchase 2.394 million shares of LDI Holdings together with an equal number of shares of Class B and Class C common stock, from CEO Anthony Hsieh among other company officers.
