Jefferson, backers seek as much as $170 million in IPO
Debt buyer's IPO comes as new listings market heats up
Buyout firm J.C. Flowers acquired Jefferson in 2018
Adds analyst comments in paragraphs 5,8
By Arasu Kannagi Basil
June 13 (Reuters) - Private equity-backed Jefferson Capital said on Friday it was targeting a valuation of up to $1.1 billion in its U.S. initial public offering, as buyout firms look to take advantage of an improving new listings market.
Jefferson and some existing investors are seeking to raise up to $170 million by offering 10 million shares priced between $15 and $17 each, in what would be a rare flotation from the debt buyer industry.
Mounting pressure to return money to investors is encouraging buyout firms to list their portfolio companies. A winning streak for new stock market listings has also boosted the IPO market, particularly for tariff-insulated companies.
Jefferson is marketing 625,000 shares, while selling stockholders, including investment firm J.C. Flowers, are offering about 9.4 million shares.
"Investors that seek out a different type of company profile will be engaged with this IPO," said Jeff Zell, senior research analyst at IPO Boutique. Jefferson offering a $0.24 quarterly dividend likely assists the investment thesis, Zell said.
Founded in 2002, Jefferson purchases and manages charged-off and bankruptcy receivables with operations mainly in the U.S., Canada, the UK and Latin America.
The Minneapolis, Minnesota-based company, which competes with PRA Group PRAA.O and Encore Capital Group ECPG.O in its core U.S. market, expanded into Canada by acquiring debt buyer Canaccede Financial Group in 2020.
Zell said the sector in which Jefferson operates is not attractive to the typical IPO investor, but there are things to like about the firm, including its strong financial metrics.
The company's profit jumped 15.6% to $128.9 million in 2024, while revenue rose 34.1% to $433.3 million.
J.C. Flowers acquired Jefferson from buyout firm Flexpoint Ford in 2018 and will own about 68.9% of it post-IPO.
Jefferson will list on the Nasdaq under the symbol "JCAP". Jefferies and Keefe, Bruyette & Woods are the lead underwriters.
(Reporting by Arasu Kannagi Basil in Bengaluru; Editing by Shilpi Majumdar)
((ArasuKannagi.Basil@thomsonreuters.com;))