Cloud-based Wall Street brokerage firm Clear Street Group Inc. (CLRS.US) has postponed its initial public offering in the United States. The decision follows a significant reduction of nearly two-thirds in the company's targeted fundraising size. A spokesperson indicated that the move was based on current market conditions.
On Thursday, Clear Street substantially scaled back its offering. According to the latest prospectus, the company now plans to offer 13 million shares at a price range of $26 to $28 per share, aiming to raise approximately $351 million. This marks a sharp departure from its initial filing, which proposed an offering of 23.8 million shares priced between $40 and $44, targeting a $1 billion raise. Based on the midpoint of the revised price range, the fundraising amount has been cut by 65% compared to the original plan.
The spokesperson stated via an email declaration that the offering had garnered strong investor interest and that Clear Street intends to reconsider an IPO at an opportune time in the future. Previous reports suggested that investor caution regarding the proposed valuation prompted the adjustment to the offering price. Sources familiar with the matter reported that the company reopened its order book on Thursday and the revised offering was oversubscribed. Regulatory filings show that BlackRock had expressed interest in purchasing up to $200 million worth of shares in the IPO.
The US IPO market has faced challenges recently. Financial technology company AGI Inc. significantly reduced its offering size just before pricing its IPO last week. Separately, advertising technology firm Liftoff Mobile Inc. called off its IPO merely hours before it was scheduled to price.
Clear Street provides its clients with access to securities and derivatives markets. The company's filings highlight its core selling point to investors: its independence from traditional computer systems, which it claims enables it to deliver more efficient clearing, settlement, custody, and financing services compared to conventional banks and brokerages. Goldman Sachs, Bank of America, Morgan Stanley, UBS Group AG, and Clear Street itself are acting as joint lead book-running managers for the offering.