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Canada Goose Holdings (GOOS-T) Roots' initial public offering (IPO) prospectus reads a lot like the Canada Goose stock-offering materials from March.
Roots would like to replicate Goose's flight, as the shares are up 50 per cent from its market debut.
There is, however, another similarity to be mindful of. Canada Goose was purchased by its private investors in 2013 for just more than $200-million, then sold to the public at a valuation of more than $2-billion, a figure that has only increased.
We do not know the Roots numbers yet, as the preliminary prospectus filed on Thursday does not say exactly how many shares will be offered, nor at what price. However, we do know, from a note deep in the filing, that its owners paid just more than $300-million for the company in December, 2015.
Roots is reported to be eyeing a valuation of at least $700-million, and there is a possibility that investors might bid it up even more. Mr. Milstead wonders if the private owners are the only ones who will get a bargain in this IPO. Early investors and insiders in IPO companies will nearly always make out better than the ordinary investor.
