WRAPUP 3-Green Dot, Ameresco up in NYSE debuts

Thu Jul 22, 2010 4:26pm EDT

* Green Dot closes 22.2 pct above its IPO price

* Green Dot top player in prepaid debit card industry

* Ameresco shares close 1.7 pct above IPO price

* Ameresco helps customers manage energy use (Updates with closing prices)

By Clare Baldwin and Maria Aspan

NEW YORK, July 22 (Reuters) - Shares of prepaid debit card company Green Dot Corp (GDOT.N) and energy efficiency consulting company Ameresco Inc (AMRC.N) rose in their market debuts on Thursday, with Green Dot up sharply as investors bet that its relationships with top retailers would pay off.

Shares of Green Dot closed at $43.99, 22.2 percent above their initial public offering price on the New York Stock Exchange. Shares of Ameresco closed at $10.17, 1.7 percent above their IPO price, also on the New York Stock Exchange.

"The IPO market is improving for companies that dominate their markets and have good topline revenue growth and are profitable," said IPOdesktop.com President Francis Gaskins.

"Green Dot has a lock on the big retailers."

Green Dot, which has agreements with Wal-Mart Stores Inc (WMT.N), Walgreen Co (WAG.N) and 7-Eleven, is the top player in the U.S. prepaid debit card industry. It relies especially heavily on Wal-Mart, which accounted for 63 percent of Green Dot's total operating revenue in the quarter ended March 31.

Analysts say Green Dot needs to reduce its reliance on the discount retailer, which recently renewed its contract with Green Dot until 2015. Wal-Mart also took a minority stake in Green Dot as part of that deal.

But the prepaid company is "completely free" to pursue partnerships with Wal-Mart's competitors, Green Dot Chief Executive Steve Streit said in an interview on Thursday.

"They know that we're sold in many other retailers ... and we're always looking for new partnerships and new expansion opportunities," he said.

REGULATORY LOOPHOLE

Green Dot sells prepaid debit cards to young, low-income consumers. Such consumers typically rely heavily on cash and do not have much access to credit.

The market for such cards is growing. Research firm Mercator Advisory Group has predicted that Americans will load as much as $118.5 billion onto prepaid cards by 2012, compared with $8.7 billion they put onto such cards in 2008.

Green Dot is exempt from a provision in the financial regulation bill which will restrict debit processing transaction fees, known as "interchange fees," that banks receive from merchants. [ID:nN18149648]

The exemption will give the company a competitive advantage, which Streit expects to enjoy for the foreseeable future.

"Now it's part of a landmark financial regulation bill that I don't think is going to grow stale in a week," he said. "That bill will be in place for many years to come, and it's unlikely that debit card interchange in and of itself will be revisited again."

The company on Wednesday sold 4.56 million shares for $36 each, raising about $164 million. It had planned to sell 4.17 million shares for $32 to $35 each.

Massachusetts-based Ameresco modifies heating, ventilation, air conditioning and lighting systems to improve their efficiency and frequently helps customers obtain third-party financing for the projects. The company also builds small-scale renewable energy generation stations that run on landfill gas, biomass and solar panels.

It sold 8.7 million shares for $10 each on Wednesday, raising about $87 million. It had planned to sell shares for $14 to $16 each.

"With the Obama administration and efficient building mandates and things like that, it could be a good play," said Darren Fabric, a managing director at IPOX Capital Management.

Green Dot's underwriters were led by JPMorgan and Morgan Stanley and Ameresco's underwriters were led by Bank of America and RBC Capital Markets.

Both companies are trading on the New York Stock Exchange. Green Dot shares are trading under the symbol "GDOT;" Ameresco shares are trading under the symbol "AMRC." (Reporting by Clare Baldwin; Editing by Gerald E. McCormick and Tim Dobbyn)

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