Stuffed-to-the-gills investors literally cannot eat another bite, and yet the dishes continue to come flying out of the kitchen at Chez Wall Street. Early-stage investors see that the getting is now as good as it will ever be and private equity sponsors are racing to dump assets into the frenzy.
They’re meeting a ho-hum reaction on The Street for the first time in awhile.
La Quinta Hotels, a Blackstone LBO exit, was supposed to price between $18 and $21 this week. Instead, the final price was $17 – not just at the low ed of the range, but below it. The company raised $650 million selling 38 million shares, tumbled down 4% on the open ticks, then spent the rest of its day trying to claw its way back to where it began, like adult Macauley Culkin.
Ally Financial – the government-rescued financing arm of General Motors before its branding change -debuted this morning to apathy and yawns. The shares priced at the bottom of its $25-$28 expected range and then dribbled down to $24 and change on the open, trading heavy as I type. Other than the fact that the Treasury is recouping another $2 billion or so from the offering, literally no one cares.
This is right in line with what I talked about as the week began – the ducks have been fed and they’ve ceased to quack. Don’t be surprised to see a much narrower IPO window this summer than what we’ve grown accustomed to for the lkast few quarters.
My working assumption is that the Alibaba deal will not be fazed at all by the recent diminished interest in syndicate – but I guess we’ll see.