Shares of U.S. plywood and lumber maker Boise Cascade Co. rose as much as 27 per cent to $26.75 (U.S.) on Wednesday in their New York Stock Exchange debut.
They last changed hands at $26.03 in afternoon trading.
Boise Cascade, whose products are used in home construction and remodeling projects, capitalized on investor enthusiasm for a recovery in the U.S. housing market.
The company was formed in 2004 by private equity firm Madison Dearborn’s acquisition of OfficeMax Inc’s forest products and paper assets. Just a year before, Boise Cascade had acquired the office supply chain for $1.1-billion, taking the OfficeMax name.
OfficeMax continues to control about 20 per cent of Boise Cascade. The Boise, Idaho-based company priced 11.8 million shares at $21, raising $247.8-million. It had raised its price range to between $18 and $20 from an earlier range of $16 to $18.
BofA Merrill Lynch and Goldman Sachs are lead underwriters on the IPO.
Boise Cascade is one of several recent housing-related IPOs. Tri Point Homes LLC, the first U.S. home builder to go public in almost a decade, raised $233-million in its January listing. Taylor Morrison Home Corp, which builds single family homes, filed in January to raise $250-million in a public offering.
The U.S. housing market has rebounded as low interest rates and rising rents have pushed many consumers to buy homes.
Boise Cascade is the most high profile deal this week in a busy time for IPOs. There are seven other IPOs, including 3D printing technology company ExOne Company, molecular testing solutions provider AutoGenomics and Brazilian contract driller QGOG Constellation S.A.
The U.S. IPO market so far this year is the strongest on record with 12 deals raising $5.3-billion in proceeds, according to Thomson Reuters data, although that figure was largely driven by Pfizer Inc spinoff Zoetis’ $2.2-billion public float.
“Right now you have an open, fertile market to raise capital,” said Scott Cutler, executive vice president and head of global listings at NYSE Euronext. “I’d expect this window to remain open for the majority of 2013.”
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