The direct-to-consumer pool and spa brand Leslie’s is planning to raise up to $640 million through an initial public offering.
The company said it would look to sell 40 million shares at a price between $14 and $16 per share. At the high end of its range, it would have a valuation of $2.98 billion.
Leslie’s said it would use the net proceeds from the offering to pay off all of its senior unsecured floating rate notes due 2024. That debt totaled $390 million as of June 27. The remainder would be put toward working capital and general corporate purposes, including the repayment of a portion of its borrowings under its term loan credit agreement, the company said. The company had outstanding term loan credit borrowings of $815.3 million as of June 27.
Demand for backyard pools surged this year as the COVID-19 pandemic led consumers to deploy discretionary income on at-home recreation activities. In July, Leslie’s rival Pool Corp. reported it had seen record sales in the second quarter.
In a regulatory filing, Leslie’s said it booked $1 billion in sales for the 12 months ended June 30.
Leslie’s was acquired by the private equity firm L Catterton in January 2017. An affiliate of Singapore’s sovereign wealth fund, GIC, also made a substantial investment at the time. Terms were not disclosed.
On completion of the IPO, affiliates of L Catterton and GIC would continue to own a majority of the voting power of the outstanding shares of common stock. Subsidiaries of BlackRock have also indicated they would buy up to $100 million of common stock at the IPO price. The underwriters have an option to purchase an additional 6 million shares.
Leslie’s would trade its common stock on the Nasdaq Global Market under the ticker symbol “LESL.”