J. Crew IPO Stirs Interest in Apparel Stocks
J. Crew Group Inc.’s initial public offering has stirred up interest for investments in apparel stocks after posting the third-largest IPO opening ever for an apparel company.
Shares of the company stock climbed 28 percent for its debut on the New York Stock Exchange, jumping to $25.55 on its opening day of trading June 28. It continued trading up 3.25 percent to $26.38 on June 29. The IPO was priced at $20 per share, above the expected $15–$17.
The IPO will reap proceeds of $376 million, which will be used by the New York–based company to redeem preferred stock.
Only IPOs from Intimate Brands (formerly Limited Inc.) and Saks Holdings Inc. have opened higher.
J. Crew has been on a comeback since 2003, when former Gap Inc. Chief Executive Mickey Drexler came on board and helped steer the company back to its more classic roots.
The retailer posted profits of $3.8 million for fiscal 2006, compared with a $100.3 million net loss the previous year. The company’s first-quarter profits this fiscal year grew by 60 percent to $8 million.
—Robert McAllister
