Dunkin’ Brands Group, owner and operator of popular fast-food donut chain Dunkin’ Donuts and ice-cream boutique Baskin Robbins, has released new details regarding its forthcoming IPO. The company filed to go public in May, seeking to raise up to $400 million in cash through a public offering. Dunkin’s current owners include private equity groups Bain Capital, Carlyle Group, and others who will not sell shares in the IPO. The groups recently met to talk pricing, valuing their jointly-held business at $2.3 billion and agreeing to fix a public offering of 22.3 million shares at a price band of $16-$18 apiece. Investment banks JP Morgan (NYSE:JPM) and Barclay’s (NYSE:BCS) will be the lead underwriters on the deal.
The company, which will trade under the ticker (DNKN) on the Nasdaq (NASDAQ:NDAQ), has regained profitability in recent years, reporting earnings of $26.9 million on revenue of $577.1 million last year. Dunkin’ currently operates 16,000 outlets across 57 countries. David Menlow, president of IPOfinancial.com, predicts a strong performance from the coming Dunkin’ debut, saying, “Dunkin’ Brands has been transformed quite dramatically into something new relative to the takeover. There are some very smart people directing the company. I think it (the IPO) will get a better-than-anticipated reaction from investors.”
Other analysts agree that Dunkin’ Brands’ staying power could lead to a strong IPO and long-term stock performance. IPO Boutique’s Scott Sweet added, “The Dunkin’ brand is not time sensitive. It has developed a huge brand awareness with Dunkin’ Donuts and Baskin Robbins,” which could add to retail investors’ confidence in the stock.
Here at Wall St. Cheat Sheet we think that Dunkin’ Brands IPO should be a great buy. Click the link to see why.