Torrid Holdings Inc. Announces Pricing of Secondary Offering of Common Stock

Rhea-AI Summary

Torrid Holdings Inc. (NYSE: CURV) has announced the pricing of a secondary public offering of 8,000,000 shares of common stock at $4.00 per share. The offering, expected to close around September 13, 2024, is being conducted by certain selling stockholders. Underwriters have a 30-day option to purchase an additional 1,200,000 shares. Torrid will not receive any proceeds from the sale. BofA Securities, Goldman Sachs & Co. , Jefferies, and William Blair are acting as joint lead book-running managers, with Telsey Advisory Group as co-manager. The offering is made through a prospectus supplement and accompanying prospectus, available on the SEC website.

Positive

• Secondary offering provides liquidity for existing shareholders without diluting current investors
• Involvement of major financial institutions as underwriters may indicate market confidence

Negative

• Company not receiving any proceeds from the offering, limiting potential for business growth or debt reduction
• Large secondary offering may signal lack of confidence from selling stockholders
• Potential downward pressure on stock price due to increased supply of shares

Financial Analyst

Torrid's secondary offering of 8 million shares at $4.00 per share is a significant move, potentially raising $32 million for the selling stockholders. This pricing suggests a market valuation of approximately $415 million for Torrid, based on its 103.75 million outstanding shares. The additional 1.2 million share option could boost proceeds by $4.8 million if exercised. However, it's important to note that Torrid won't receive any proceeds from this offering, which may limit its impact on the company's financial position. This move could indicate that major shareholders are looking to reduce their stake, potentially signaling a lack of confidence in future growth prospects.

Market Research Analyst

The secondary offering's timing and pricing provide insights into Torrid's market position. The $4.00 per share price represents a 33% discount from Torrid's IPO price of $21 in July 2021, reflecting challenging market conditions for specialty retailers. This offering might increase liquidity for Torrid's stock, potentially attracting new investors. However, the substantial discount could also signal investor concerns about the company's growth trajectory in the competitive plus-size fashion market. The involvement of major underwriters like BofA Securities and Goldman Sachs suggests continued institutional interest, which could provide some stability to the stock price post-offering.

Legal Expert

The secondary offering's structure and disclosure comply with SEC regulations, demonstrating Torrid's commitment to transparency. The company's use of a Form S-3 shelf registration allows for quicker execution of the offering, indicating proactive financial planning. The 30-day option granted to underwriters provides flexibility in managing market demand. Importantly, the clear statement that Torrid will not receive proceeds from the sale protects the company from potential misrepresentation claims. The extensive list of underwriters and their roles suggests a well-coordinated offering, which could mitigate legal risks associated with the transaction. Investors should carefully review the prospectus supplement for full details on risks and use of proceeds.

CITY OF INDUSTRY, Calif.--(BUSINESS WIRE)-- Torrid Holdings Inc. (“Torrid” or the “Company”) (NYSE: CURV) today announced the pricing of the previously announced underwritten public offering of 8,000,000 shares of the Company’s common stock at a price to the public of $4.00 per share (the “Offering”) to be sold by certain stockholders of the Company (the “Selling Stockholders”). The Offering is expected to close on or about September 13, 2024, subject to the satisfaction of customary closing conditions. In addition, the Selling Stockholders have granted the underwriters a 30-day option to buy an additional 1,200,000 shares of common stock at the public offering price, less the underwriting discount and commissions. Torrid will not receive any of the proceeds from the sale of the shares by the Selling Stockholders, including from any exercise by the underwriters of their option to purchase additional shares.

BofA Securities, Goldman Sachs & Co. LLC, Jefferies and William Blair are acting as joint lead book-running managers for the Offering. Telsey Advisory Group is acting as co-manager for the Offering.

A registration statement (including a prospectus) on Form S-3 was initially filed with the Securities and Exchange Commission (the “SEC”) on February 16, 2024, and has been declared effective. The Offering is being made only by means of a prospectus supplement and the accompanying prospectus. Before you invest, you should read the registration statement, the prospectus supplement, the accompanying prospectus and other documents the Company has filed or will file with the SEC for information about the Company and the Offering. You may obtain these documents free of charge by visiting EDGAR on the SEC website at www.sec.gov. Alternatively, copies of the prospectus supplement and the accompanying prospectus, when available, may be obtained by contacting: BofA Securities, Attention: Prospectus Department, NC1-022-02-25, 201 North Tryon Street, Charlotte, North Carolina, 28255-0001, or by email at dg.prospectus_requests@bofa.com; Goldman Sachs & Co. LLC, Attention: Prospectus Department, 200 West Street, New York, NY 10282, or by email at prospectus-ny@ny.email.gs.com; Jefferies LLC, Attention: Equity Syndicate Prospectus Department, 520 Madison Avenue, New York, NY 10022, or by email at Prospectus_Department@Jefferies.com; or William Blair & Company, L.L.C., Attention: Prospectus Department, 150 North Riverside Plaza, Chicago, IL 60606, or by email at prospectus@williamblair.com.

This press release shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of these securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.

About TORRID

TORRID is a direct-to-consumer brand in North America dedicated to offering a diverse assortment of stylish apparel, intimates, and accessories skillfully designed for curvy women. Specializing in sizes 10 to 30, TORRID’s primary focus is on providing fashionable, comfortable, and affordable options that meet the unique needs of its customers. TORRID’s extensive collection features high quality merchandise, including tops, bottoms, denim, dresses, intimates, activewear, footwear, and accessories. Revenues are generated primarily through its e-Commerce platform and its stores in the United States of America, Puerto Rico and Canada.

Forward-Looking Statements

This press release contains forward-looking statements, including statements regarding the Offering and expected closing date. These statements are not historical facts but rather are based on Torrid's current expectations and projections regarding its business, operations and other factors relating thereto. Words such as “expect,” “intend,” “believe,” “may,” “will,” “should,” and other words and terms of similar meaning (including their negative counterparts or other various or comparable terminology) are used to identify these forward-looking statements. These statements are only predictions and as such are not guarantees of future performance and involve risks, uncertainties and assumptions that are difficult to predict. Actual results may differ materially from those in the forward-looking statements as a result of a number of factors, including those set forth in the "Risk Factors" section of the registration statement and the prospectus supplement for the Offering and the Company’s other filings with the SEC. Any such forward-looking statements are made pursuant to the safe harbor provisions of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, and speak only as of the date of this press release. Torrid undertakes no duty to update any forward-looking statements made herein.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240911387093/en/

Investors

ICR

Lyn Walther

IR@torrid.com

Media

Joele Frank, Wilkinson Brimmer Katcher

Michael Freitag / Arielle Rothstein / Lyle Weston

Media@torrid.com

Source: Torrid Holdings Inc.

FAQ

How many shares of CURV stock are being offered in the secondary offering?

Torrid Holdings Inc. (CURV) is offering 8,000,000 shares of common stock in the secondary offering, with an additional 1,200,000 shares available through the underwriters' 30-day option.

What is the price per share for CURV's secondary offering?

The price per share for Torrid Holdings Inc.'s (CURV) secondary offering is $4.00.

When is the expected closing date for CURV's secondary stock offering?

The secondary stock offering for Torrid Holdings Inc. (CURV) is expected to close on or about September 13, 2024, subject to customary closing conditions.

Will Torrid Holdings (CURV) receive any proceeds from this secondary offering?

No, Torrid Holdings Inc. (CURV) will not receive any proceeds from the secondary offering. The shares are being sold by certain stockholders of the company.