Colfax pumps up the IPO volume

Filed under: Merrill Lynch (MER)

Yesterday, I met with a couple deal attorneys and we talked about IPOs. I learned that that they are currently working on an offering. Of course, the company is in the energy sector.

While the IPO market should remain listless, there are still a few sectors that are hot. Look at Colfax (NYSE: CFX), which launched its IPO today. The company priced its offering at $18 per share (the price range was $15-$17). So far in today's trading, Colfax shares are trading up 22% to $22.08.

Basically, Colfax is a major supplier of fluid handling products, such as pumps, fluid handling systems and specialty valves. The main customer groups include power generation, global navy, commercial marine and yes, oil & gas. Some of the brands include Allweiler, Fairmount, Houttuin, Imo, LSC, Portland Valve, Tushaco, Warren and Zenith. In fact, the Allweiler brand goes back to 1860.

Actually, the marketplace is highly fragmented, with more than 10,000 companies. So, with the IPO proceeds and public stock, Colfax is positioned for M&A deals (the company has already purchased 12 companies).

And the financials look pretty good. Last year, Colfax's revenues jumped 29% to $506.3 million and net income came to $64.9 million.

The lead underwriter on the deal is Merrill Lynch & Co. (NYSE: MER). Also, you can find the prospectus at the SEC website.

Tom Taulli is the author of various books, including The Complete M&A Handbook and The Edgar Online Guide to Decoding Financial Statements. He also operates MergerBook.com.

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