Reuters: Global Markets: Ply Gem shares rise in NYSE debut

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Ply Gem shares rise in NYSE debut May 23rd 2013, 16:45 By Neha Dimri Thu May 23, 2013 12:45pm EDT (Reuters) - Shares of building products maker Ply Gem Holdings Inc (PGEM.N) rose as much as 14 percent in their market debut, valuing the company at about $1.55 billion, as investors tap into companies catering to the recovering U.S. housing market. Ply Gem shares opened at $22.35 in their New York Stock Exchange debut, 6 percent above the IPO price of $21. Ply Gem Holdings sold 15.8 million shares, raising $332 million, after pricing its offering above the planned range of $18 to $20. IPODesktop.com partner Francis Gaskins said Ply Gem's successful IPO reflected general interest in the U.S. housing sector. "(Ply Gem's) financials are not strong. Investors are buying the sector and not playing close attention to the company's underlying financials," Gaskins said. The company reported a net loss of $28.1 million on net sales of $257.1 million for the quarter ended March 30. Ply Gem said it expects to benefit from record-low interest rates and rising rents that have encouraged more Americans to buy homes after the housing bust. The U.S. homebuilder sentiment index rose to 44 in May from 41 in April as sales improved, data from the National Association of Home Builders (NAHB) showed last week. The NAHB has forecast single-family housing starts to rise by about 24 percent in 2013. Plywood and lumber producer Boise Cascade Co's (BCC.N) shares have risen 40 percent since it went public in February. The stocks of homebuilders Tri Pointe Homes Inc (TPH.N), William Lyon Homes (WLH.N) and Taylor Morrison Home Corp (TMHC.N) are trading well above their IPO prices. Williams Financial Group analyst David Williams said he expected more building products makers to come to the stock market in the near term. "Some of these companies that suffered through the (economic) downturn were injected with funds from private equity ... that have found a lot of efficiencies and have set these businesses up to really benefit from this upcycle," Williams said. Private equity firm CI Capital Partners will hold 68.4 percent of Ply Gem after the, offering if the underwriters exercise full rights to buy additional shares. The company, which operates brands such as Ply Gem, Mastic Home Exteriors and Variform, makes customized fencing, windows, doors and other home exterior products. Ply Gem, which initially filed to go public in May 2010, counts CertainTeed, Associated Materials Inc and Royal Building Products among its competitors. The company listed JP Morgan, Credit Suisse and Goldman Sachs as lead underwriters to the offering. Shares of Ply Gem were up 13 percent at $23.80 on the New York Stock Exchange by afternoon after touching a high of $24. About 5.5 million shares changed hands by 1223 ET. (Additional reporting by Sagarika Jaisinghani in Bangalore; Editing by Anil D'Silva) Link this Share this Digg this Email Reprints

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