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TPG launches IPO roadshow seeking valuation around $9.5 billion

2 min read . Updated: 05 Jan 2022, 06:05 PM IST MIRIAM GOTTFRIED, The Wall Street Journal

Private-equity firm expects to begin trading next week, people familiar with matter say

Private-equity firm TPG launched its roadshow pitch to investors Tuesday, seeking a valuation as high as $9.5 billion in its initial public offering, moving into the final stretch of a process that has been months in the making.

The firm and some of its shareholders are aiming to sell shares at between $28 and $31 apiece, it said in a regulatory filing Tuesday. It plans to trade on the Nasdaq under the ticker symbol “TPG."

TPG—based in Fort Worth, Texas, and San Francisco—plans to price its offering next Wednesday and list shares the following day, although the timing could change, according to people familiar with the matter.

The Wall Street Journal first reported in June that TPG was in the early stages of weighing a public listing that could value it at about $10 billion.

TPG aims to sell 28.3 million shares in the offering, of which 13.6 million will be used to purchase shares from existing shareholders, while China Life Trustees Ltd. plans to sell 5.6 million shares, according to the filing.

TPG’s offering is set to be the first big IPO of 2022, and its performance will help investors, bankers and other companies seeking to go public gauge the health of the IPO market. Last year, traditional IPOs raised more than $150 billion in the U.S., according to Dealogic.

But despite the record haul, IPO performance sputtered in the final weeks of the year. By late December, roughly two-thirds of newly listed companies were trading below their IPO prices.

Shares of publicly traded private-equity firms have been on a tear of late, thanks in part to a rising market. Low interest rates also have made borrowing cheap and led yield-hungry investors to funnel hundreds of billions of dollars into the firms’ coffers.

The group’s strong performance has led others to list shares, including European private-equity firm Bridgepoint Group PLC and Blue Owl Capital Inc., which was formed last year through a merger with a special-purpose acquisition company.

With $109 billion in assets under management and offices around the world, TPG has been one of the last of the original buyout giants to remain a private partnership. With the IPO, it will join peers such as Blackstone Inc., Apollo Global Management Inc. and KKR & Co., which have been public for years.

Unlike those firms, which retained their partnership structures for many years after their IPOs before converting to C-corporations on the heels of the 2017 tax cuts, TPG will debut as a corporation called TPG Inc. The decisions by its rivals to convert have contributed to the recent surge in their valuations over the past couple of years.

TPG is smaller than many of its competitors, which have built sprawling businesses investing in areas including credit, real estate and insurance. But the IPO should give it fuel to expand its already sizable segments dedicated to large-scale private equity, investing in rapidly growing companies, socially responsible investing, real estate and tailored investment opportunities in areas such as SPACs and public companies.

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