IPO Watch: Houlihan Set To Make Debut

(RTTNews) - Investment banking firm Houlihan Lokey, Inc. (HLI) is expected to make its market debut on Thursday by selling 13.06 million shares of its Class A common stock in an initial public offering that will raise about $300 million.

The completion of the IPO is expected give the company a market valuation of up to $1.57 billion, based on about 65 million shares outstanding following the offering.

The company's Class A common stock has been approved for listing on the New York Stock Exchange under the ticker symbol "HLI." The IPO is estimated to be price in a range of $22.00 and $24.00 per share.

The company said the selling stockholders, including affiliates of Orix USA Corp. and an entity owned by certain employees and members of its management, are offering the shares.

Orix USA is a subsidiary of Japanese conglomerate Orix Corp. (IX), which bought a 70 percent stake in 2006 for a mix of cash and stock worth about $500 million. Following the IPO, Orix will hold about one-third of Houlihan Lokey's total shares outstanding.

Houlihan added it will not receive any of the proceeds from the sale of the Class A common stock by the selling stockholders in this offering, including from any exercise by the underwriters of their option.

Los Angeles, California-based Houlihan Lokey had filed a initial registration statement on Form S-1 with the Securities and Exchange Commission on July 10 for an IPO of up to $100 million.

The underwriters for the offering were Bank of America's Merrill Lynch and Goldman Sachs, with UBS Investment Bank, JPMorgan and others serving as co-managers.

Established in 1972, Houlihan Lokey is a leading global independent investment bank with expertise in mergers and acquisitions, financings, financial restructurings and financial advisory services. It is one of the oldest and largest privately-owned investment banks in the world.

It is also one of the largest, most experienced restructuring practices globally, having advised on more than 1,000 restructuring transactions, including 12 of the 15 largest U.S. bankruptcies since 2000, such as Lehman Brothers, Worldcom, Enron, the CIT Group and General Motors.

As of June 30, 2015, the company had a team of 695 financial professionals across 17 offices globally and an additional three offices through its joint ventures, serving about 800 clients annually.

From fiscal 2000 to fiscal 2015, the company's revenues have grown grew to $680.9 million from $144.1 million, and net income during the same period grew to $79.9 million from $15.6 million.

The company generated total fee revenue of $520.29 million, $592.15 million and $680.87 million for the fiscal years ended March 31, 2013, 2014 and 2015, respectively.

It also generated net income of $58.97 million, $61.32 million and $79.88 million for the fiscal years ended March 31, 2013, 2014 and 2015, respectively.