Ichor Holdings, Ltd. Announces Pricing of $125 Million Public Offering
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Insights
The pricing of Ichor Holdings' public offering at $37.50 per share represents a strategic move to strengthen the company's balance sheet. By repaying outstanding debt, the company is likely aiming to reduce interest expenses and improve its financial leverage ratio. This can be seen as a positive signal to investors that management is focused on maintaining a healthy capital structure. The option for underwriters to purchase additional shares could also provide a cushion for the company, potentially reducing the risk of stock price volatility post-offering. However, the dilutive effect on existing shareholders cannot be ignored, as the increase in share count will spread the company's earnings over a larger base, potentially impacting earnings per share (EPS).
The semiconductor industry is known for its cyclical nature and capital-intensive operations. Ichor Holdings' decision to potentially allocate funds for capital expenditures and strategic acquisitions indicates an aggressive growth strategy. Given the industry's rapid technological advancements, staying competitive often requires continuous investment in R&D and modernizing equipment. Investors should assess the company's past capital allocation efficiency and how these investments could translate into market share gains or entry into new markets. The timing of the offering, market conditions and the company's performance relative to its peers would also be critical factors in evaluating the potential impact on the company's stock performance.
From a legal perspective, the offering's reliance on an effective shelf registration statement on Form S-3 suggests a level of preparedness and strategic planning. Shelf registrations allow for the quick capitalization on favorable market conditions, which can be advantageous for the issuer. However, the final terms disclosed in the final prospectus supplement will be crucial for investors, as they contain detailed information about the offering's specifics and the associated risks. Investors should review these documents thoroughly to understand the legal implications and rights associated with the newly issued shares, especially in light of the SEC's regulatory framework.
The Company intends to use the net proceeds it receives from the offering to repay outstanding indebtedness and for general corporate purposes, which may include, among other things, capital expenditures, potential acquisitions, growth opportunities, and strategic transactions. The offering is expected to close on March 18, 2024, subject to the satisfaction of customary closing conditions.
TD Cowen and Stifel are acting as joint book-running managers and representatives of the underwriters for the offering. B. Riley Securities, Needham & Company, Craig-Hallum and D.A. Davidson & Co. are acting as co-managers for the offering.
The shares are being offered by the Company pursuant to an effective shelf registration statement on Form S-3 that was filed with the Securities and Exchange Commission ("SEC") on August 9, 2023 and became effective upon such filing.
This offering is being made only by means of a prospectus supplement and accompanying base prospectus that form a part of the registration statement. A preliminary prospectus supplement relating to and describing the terms of the offering was filed with the SEC on March 12, 2024, copies of which may be obtained for free by visiting the SEC’s website at www.sec.gov. The prospectus supplement and accompanying base prospectus may also be obtained by sending a request to: Cowen and Company, LLC, 599 Lexington Avenue,
Investors are advised to carefully consider the investment objective, risks, charges and expenses of Ichor Holdings, Ltd. before investing. The preliminary prospectus supplement dated March 12, 2024 and the accompanying prospectus dated August 9, 2023 contain this and other information about Ichor Holdings, Ltd. and should be read carefully before investing.
This press release shall not constitute an offer to sell or the solicitation of an offer to buy the Company’s ordinary shares or any other securities, and there shall not be any offer, solicitation, or sale of securities mentioned in this press release 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 such any state or jurisdiction.
About Ichor
We are a leader in the design, engineering and manufacturing of critical fluid delivery subsystems and components primarily for semiconductor capital equipment, as well as other industries such as defense/aerospace and medical. Our primary product offerings include gas and chemical delivery subsystems, collectively known as fluid delivery subsystems, which are key elements of the process tools used in the manufacturing of semiconductor devices. Our gas delivery subsystems deliver, monitor and control precise quantities of the specialized gases used in semiconductor manufacturing processes such as etch and deposition. Our chemical delivery subsystems precisely blend and dispense the reactive liquid chemistries used in semiconductor manufacturing processes such as chemical-mechanical planarization, electroplating, and cleaning. We also provide precision-machined components, weldments, e-beam and laser welded components, precision vacuum and hydrogen brazing, surface treatment technologies, and other proprietary products. We are headquartered in
Safe Harbor Statement
Certain statements in this release are "forward-looking statements" made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The words “anticipate,” “believe,” “contemplate,” “designed,” “estimate,” “expect,” “forecast,” “goal,” “guidance,” “intend,” “may,” “outlook,” “plan,” “predict,” “project,” “see,” “seek,” “target,” “would” and similar expressions or variations or negatives of these words are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words.
Examples of forward-looking statements include statements regarding the completion, timing, size and use of proceeds of the offering and the satisfaction of closing conditions related to the offering, as well as any other statement that does not directly relate to any historical fact. Such forward-looking statements are based on our management’s current expectations about future events as of the date hereof and involve many risks and uncertainties that could cause our actual results to differ materially from those expressed or implied in our forward-looking statements. Our actual results and outcomes could differ materially from those included in these forward-looking statements as a result of various factors, including, but not limited to: (1) geopolitical, economic and market conditions, including high inflation, changes to fiscal and monetary policy, high interest rates, currency fluctuations, challenges in the supply chain and any disruptions in the global economy as a result of the conflicts in
All forward-looking statements in this press release are based upon information available to us as of the date hereof, and qualified in their entirety by this cautionary statement. We undertake no obligation to update or revise any forward-looking statements contained herein, whether as a result of actual results, changes in our expectations, future events or developments, or otherwise, except as required by law.
View source version on businesswire.com: https://www.businesswire.com/news/home/20240313163729/en/
Greg Swyt, CFO 510-897-5200
Claire McAdams, IR & Strategic Initiatives 530-265-9899
ir@ichorsystems.com
Source: Ichor Holdings, Ltd.
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