A Bay Street sign, the main street in the financial district is seen in Toronto, January 28, 2013.MARK BLINCH/Reuters
The initial public offering of George Soros-backed reinsurer Aurigen Capital Ltd. is struggling amid slack demand and doubts about valuation, leading to a cut in the sale price and the size of the offering.
The IPO had been expected to price this week; however, investors balked. Aurigen is now looking to raise $200-million, down from $250-million. The price range for the shares has been slashed to $9.50 to $10.50 apiece from $13 to $15, according to a person who has viewed the terms.
The transaction is now expected to close next week.
Royal Bank of Canada is leading the deal, along with Canaccord Genuity and TD Securities.
It appears to be more of a company-specific issue than a problem with a sudden drop in demand for new IPOs. Aurigen's stumbles come after a handful of IPOs so far this year that were strongly supported, including a hugely over-subscribed going-public transaction for lighting maker Lumenpulse and the popular IPO of finance company Callidus Capital.
Aurigen's backers include a Soros fund and Canadian private equity fund Edgestone Capital Partners.