Nasdaq Announces Pricing of Secondary Offering of Nasdaq Common Stock

Rhea-AI Summary

Nasdaq (NDAQ) has announced the pricing of a secondary public offering by Argus Seller, LP, an affiliate of Thoma Bravo-managed funds. 41,604,207 shares of Nasdaq's common stock will be offered at $65.30 per share. The offering is expected to close on July 30, 2024. Nasdaq will not receive any proceeds from this sale.

Additionally, Nasdaq has agreed to repurchase 1,200,000 shares from the Selling Stockholder as part of its existing share repurchase program. After the offering and repurchase, the Selling Stockholder will hold 42,804,207 shares, representing about 7.4% of Nasdaq's outstanding shares, subject to a lock-up until May 1, 2025. Goldman Sachs & Co. is the sole book-running manager for the offering.

Positive

• Nasdaq is repurchasing 1,200,000 shares, potentially supporting stock price
• The share repurchase offsets employee dilution, maintaining shareholder value
• Selling Stockholder's remaining shares are locked up until May 1, 2025, reducing potential market pressure

Negative

• Large secondary offering of 41,604,207 shares may put downward pressure on stock price
• Nasdaq is not receiving any proceeds from the secondary offering
• Potential increase in debt due to borrowing for share repurchase

Financial Analyst

The pricing of Nasdaq's secondary offering marks a significant development in the company's financial landscape. With 41,604,207 shares priced at $65.30 per share, this offering could generate approximately $2.72 billion for the Selling Stockholder. It's important to note that Nasdaq itself isn't selling shares or receiving proceeds, which suggests this move is primarily about ownership restructuring rather than raising capital for the company.

The Concurrent Share Repurchase of 1,200,000 shares is an interesting strategic move. By repurchasing shares, Nasdaq is effectively reducing its outstanding share count, which could potentially boost earnings per share. This action, funded through existing cash and commercial paper, demonstrates Nasdaq's financial flexibility and commitment to managing its capital structure.

Post-transaction, the Selling Stockholder's ownership will decrease to approximately 7.4% of Nasdaq's outstanding shares, with a lock-up period until May 1, 2025. This reduction in ownership could potentially increase the stock's liquidity and free float, which might be viewed positively by the market. However, investors should monitor any potential impact on stock price and trading volume in the short term due to this significant share offering.

Market Research Analyst

This secondary offering presents an intriguing scenario for Nasdaq's market position and investor perception. The substantial size of the offering - over 41 million shares - could potentially lead to short-term price pressure on Nasdaq's stock. However, the fact that a major private equity firm is reducing its stake might be interpreted as a vote of confidence in Nasdaq's current valuation and future prospects.

The pricing at $65.30 per share provides a clear market benchmark for Nasdaq's current value. Investors should compare this to recent trading prices and consider whether this represents a premium or discount. The market's reaction to this pricing will be telling.

Notably, the Concurrent Share Repurchase aligns with broader market trends of companies using buybacks to manage their share count and potentially support stock prices. This move could be seen as a signal of Nasdaq's confidence in its own value proposition.

Looking ahead, the reduction of Thoma Bravo's stake to 7.4% with a lock-up until May 2025 creates an interesting dynamic. This remaining stake suggests continued alignment with Nasdaq's interests, while the lock-up provides some predictability for the market regarding potential future sales.

Legal Expert

The secondary offering by Nasdaq presents several legal and regulatory considerations that investors should be aware of. First, the filing of a registration statement with the SEC ensures compliance with federal securities laws, providing potential investors with access to comprehensive information about the offering and Nasdaq's financial position.

The clear disclosure that Nasdaq is not selling any shares or receiving proceeds from this offering is important from a legal standpoint. It delineates the company's role and protects it from potential claims related to the use of proceeds.

The Concurrent Share Repurchase agreement is an important legal arrangement. By specifying that it's part of an existing share repurchase program and aimed at offsetting employee dilution, Nasdaq is demonstrating proper corporate governance and transparency in its capital management strategies.

The lock-up agreement extending to May 1, 2025, for the Selling Stockholder's remaining shares is a significant legal commitment. This contractual obligation provides market stability and prevents immediate further dilution, which could be seen as a positive factor for current shareholders.

Lastly, the explicit statement that the press release does not constitute an offer to sell or solicitation to buy securities in jurisdictions where it would be unlawful is a critical legal disclaimer, ensuring compliance with varied state and international securities regulations.

NEW YORK, July 29, 2024 (GLOBE NEWSWIRE) -- Nasdaq, Inc. (Nasdaq: NDAQ) (the “Company” or “Nasdaq”) today announced the pricing of the previously announced secondary public offering by Argus Seller, LP (the “Selling Stockholder”), an affiliate of certain funds managed by Thoma Bravo, L.P., of 41,604,207 shares of Nasdaq’s common stock at a price to the public of $65.30 per share. The offering is expected to close on July 30, 2024, subject to customary closing conditions. Nasdaq is not selling any shares of its common stock in the offering and will not receive any proceeds from the sale of the shares by the Selling Stockholder in the offering.

In addition, on July 25, 2024, Nasdaq entered into a share repurchase agreement with the Selling Stockholder conditioned on the secondary public offering, pursuant to which Nasdaq has agreed to purchase from the Selling Stockholder 1,200,000 shares of common stock (the “Concurrent Share Repurchase”). The Concurrent Share Repurchase is part of the Company’s existing share repurchase program and offsets employee dilution. Nasdaq intends to fund the Concurrent Share Repurchase from existing cash on hand, together with borrowings under its commercial paper program. The underwriter will not receive any compensation for the shares being repurchased by Nasdaq.

At the completion of the offering and the Concurrent Share Repurchase, the Selling Stockholder is expected to hold 42,804,207 shares, representing approximately 7.4% of Nasdaq’s outstanding shares, which remain subject to an existing contractual lock-up until May 1, 2025.  

Goldman Sachs & Co. LLC is acting as sole book-running manager for the offering.

Nasdaq has filed a registration statement (including a prospectus) with the U.S. Securities and Exchange Commission (the “SEC”) for the offering to which this communication relates. Before you invest, you should read the prospectus in the registration statement and other documents Nasdaq has filed with the SEC for more complete information about Nasdaq and the offering. You may get these documents for free by visiting EDGAR on the SEC’s website at www.sec.gov. Alternatively, Nasdaq, any underwriter or any dealer participating in the offering will arrange to send you the prospectus if you request it by contacting Goldman Sachs & Co. LLC, Prospectus Department, 200 West Street, New York, NY 10282, telephone: 1-866-471-2526, facsimile: 212-902-9316 or by emailing Prospectus-ny@ny.email.gs.com. This press release shall not constitute an offer to sell or the solicitation of an offer to buy the securities described herein, nor shall there be any offer or 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 Nasdaq

Nasdaq (Nasdaq: NDAQ) is a leading global technology company serving corporate clients, investment managers, banks, brokers, and exchange operators as they navigate and interact with the global capital markets and the broader financial system. We aspire to deliver world-leading platforms that improve the liquidity, transparency, and integrity of the global economy. Our diverse offering of data, analytics, software, exchange capabilities, and client-centric services enables clients to optimize and execute their business vision with confidence.

Cautionary Note Regarding Forward-Looking Statements

This press release contains forward-looking information that involves substantial risks, uncertainties and assumptions that could cause actual results to differ materially from those expressed or implied by such statements. When used in this communication, words such as “enables”, “intends”, “will”, “can”, “expected”, “enhances” and similar expressions and any other statements that are not historical facts are intended to identify forward-looking statements. Forward-looking statements in this press release include, among other things, statements about the offering and the Concurrent Share Repurchase, Nasdaq’s plans, objectives, expectations and intentions and the financial condition, results of operations and business of Nasdaq. Risks and uncertainties include, among other things, risks related to the ability of Nasdaq to consummate the offering, Nasdaq’s ability to implement its strategic vision, initiatives, economic, political and market conditions and fluctuations, government and industry regulation, interest rate risk, U.S. and global competition, and other factors detailed in Nasdaq’s reports filed on Forms 10-K, 10-Q and 8-K and in other filings Nasdaq makes with the SEC from time to time and available at www.sec.gov. These documents are also available under the Investor Relations section of the Company’s website at http://ir.nasdaq.com/investor-relations. The forward-looking statements included in this communication are made only as of the date hereof. Nasdaq disclaims any obligation to update these forward-looking statements, except as required by law.

Media Relations Contact:

Marleen Geerlof
+1.347.380.3520
Marleen.Geerlof@Nasdaq.com

Investor Relations Contact:

Ato Garrett
+1.212.401.8737
Ato.Garrett@Nasdaq.com

-NDAQF-

FAQ

How many shares of Nasdaq (NDAQ) are being offered in the secondary public offering?

41,604,207 shares of Nasdaq's common stock are being offered in the secondary public offering by Argus Seller, LP.

What is the price per share for Nasdaq's (NDAQ) secondary offering?

The price per share for Nasdaq's secondary offering is $65.30.

When is the expected closing date for Nasdaq's (NDAQ) secondary offering?

The secondary offering is expected to close on July 30, 2024, subject to customary closing conditions.

How many shares is Nasdaq (NDAQ) repurchasing from the Selling Stockholder?

Nasdaq is repurchasing 1,200,000 shares from the Selling Stockholder as part of its existing share repurchase program.

What percentage of Nasdaq (NDAQ) shares will the Selling Stockholder hold after the offering and repurchase?

After the offering and repurchase, the Selling Stockholder is expected to hold approximately 7.4% of Nasdaq's outstanding shares.