IntercontinentalExchange (ICE) Friday said it has filed with the Securities and Exchange Commission (SEC) for a proposed secondary offering of 8 million shares of its common stock. The selling stockholders will offer 7,975,000 shares in the proposed offering, and ICE will offer 25,000 shares primarily to cover expenses it will incur in connection with the proposed offering.
Atlanta, GA-based ICE, which first offered shares to the public in an initial public offering (IPO) last November, (see NGI, Nov. 21, 2005), said the secondary offering is "to facilitate an orderly entry into the market of freely tradable shares by certain founding shareholders." Management will not be selling shares in the offering. Selling shareholders have granted the underwriters an option to purchase up to an additional 1,200,000 shares. The company currently has over 20 million common shares outstanding.
In the initial IPO, ICE shares, priced at $18-$20, soared to just under $39 in the first day. Since then the shares have recorded peaks above $70 to nearly $80, but have been on a downtrend since early May. The share price was trading around $49 Friday. The company had announced in mid-May it was considering a secondary offering.
No deals under the secondary offering will be done prior to the time the SEC makes the registration statement effective.
ICE operates an electronic marketplace for trading both futures and OTC energy contracts, offering a range of contracts based on crude oil and refined products, natural gas, power and emissions. It conducts its futures markets through its regulated London-based subsidiary, ICE Futures. ICE introduced the concept of cleared OTC energy contracts and offers the most liquid and transparent electronic OTC market in North America. ICE also offers a range of risk management and trading support services, including customized energy market data offerings through its ICE Data business unit and electronic trade confirmations.
ICE's success in the electronic marketplace helped spur the New York Mercantile Exchange Inc. Nymex) to look at electronic trading of both cash-settled and physically delivered Nymex Division energy futures contracts alongside its open pit operations. Nymex trading of cash-settled energy futures contracts began earlier this week on the Globex trading platform run by the Chicago Mercantile Exchange (CME). The Nymex/CME deal was first announced in April (see NGI, April 10; June 12).
ICE reported futures transactions for 2005 at 42.1 million contracts, up 18.3% over 2004. Its consolidated net income increased 141.9% from $21.9 million in 2004 to $53.1 million in 2005 (see NGI, March 20).
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