FMC Corporation Carves-Out Livent Lithium Business In IPO

Livent Corporation President and CEO Paul Graves is applauded as he rings a ceremonial bell on the floor of the New York Stock Exchange as his company’s IPO begins trading, Thursday, Oct. 11, 2018. (AP Photo/Richard Drew)

On October 11, 2018, Livent Corporation (NYSE: LTHM, $16.25, Market Capitalization: $2.3 billion) started trading on the NYSE after its IPO. The stock opened at $16.25, achieved an intraday high of $16.98 and closed the day at $16.97, 4% higher than the opening price. Earlier, on October 10, 2018, the company announced pricing for the IPO at $17.00 per share, ~6% below the lower range of the band ($18.00-$20.00 per share). FMC Corporation (NYSE: FMC, $84.86, Market Capitalization:$11.4 billion) received overall proceeds of $340 million with the sale of~14% or 20 million of LTHM’s total issued and outstanding shares (total of 143 million shares) at the IPO price of $17.00 per share.


Price PerformanceSPIN-OFF RESEARCH

On March 31, 2017, FMC had announced its intention to separate FMC Lithium as a separate publicly-traded company. On July 26, 2018, FMC announced that it will rebrand its “Lithium Material business” as “Livent Corporation”. On August 27, 2018, Livent Corporation fi led an initial FormS-1 with the SEC followed by an amended Form S-1 on October 1, 2018 announcing details of IPO of the Lithium business. The company had anticipated IPO price range of $18.00-$20.00 per share. Livent granted the underwriters an option to purchase up to an aggregate of 3,000,000 additional shares of its common stock to cover over-allotments at IPO price, less the underwriting discount, for 30 days after the date of prospectus on October 1, 2018. Post IPO, Livent has 143,000,000 shares outstanding and FMC beneficially owns 86.01% of Livent’s outstanding common stock (or 84.25% if the underwriters’ option to purchase additional shares of common stock is exercised in full). FMC Corporation will distribute the remaining shares of Livent to FMC shareholders through a spin-off or split-off, thus completing the full separation of Livent from FMC (expected to complete by late 1Q19).


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