Shares in US in-flight broadband provider Gogo began trading on NASDAQ today after pricing at the top of the IPO’s initial US$15-US$17 range.
The IPO could raise as much as US$215m if an over-allotment option adds an extra 1.65 million shares on top…
Shares in US in-flight broadband provider Gogo began trading on NASDAQ today after pricing at the top of the IPO’s initial US$15-US$17 range.
The IPO could raise as much as US$215m if an over-allotment option adds an extra 1.65 million shares on top of the 11 million being listed. The company expects to close the offering on 26 June.
Proceeds will be used for general corporate purposes, including international expansion as Gogo – formerly known as Aircell – looks to grow a business that offers passengers internet connectivity on more than 1,900 commercial aircraft. Its partners include American Airlines, Air Canada and AirTran Airways.
The funding is needed to cover investments associated with satellite or other technologies, such as costs to develop and implement changes to ground and airborne software and hardware, as well as to acquire satellite capacity.
Following the listing, Gogo’s main shareholders, private equity firm Ripplewood Holdings and investment group Blumenstein/Thorne Information Partners, will continue to hold sizeable stakes.
If the overallotment option is exercised, Ripplewood’s stake will be reduced from 38% to 31.8%, while Thorne will see its share drop from 38% to 31.8%.
The shareholders had planned to fund Gogo’s expansion with a US$100m IPO in late 2011, but that was shelved following market turbulence.
It instead looked to the debt markets to raise financing. Gogo subsequently raised US$135m via Morgan Stanley and JP Morgan in mid-2012, and in April this year secured a US$113m add-on to that facility.
Morgan Stanley and JP Morgan are also underwriters and joint bookrunners for Gogo’s IPO, along with UBS. Allen & Co, Evercore Partners and William Blair are co-managers.
