July 19 Shares of Diamond Resorts International
Inc rose as much as 5 percent in their market debut on
Friday after the vacation timeshare company's initial public
offering priced well below the expected range.
Diamond Resorts raised $217 million by selling 15.5 million
shares at $14 each, below the expected price range of $16-18.
The shares touched a high of $14.73 in early trading on the
New York Stock Exchange, valuing the Las Vegas-based company at
Diamond owns and operates 79 resorts in the United States,
Mexico, the Caribbean and Europe. Its timeshare vacation
business accounts for 72 percent of overall revenue, with the
rest coming from its financing and hospitality businesses.
The timeshare vacation business is growing quickly. Sales in
the United States rose 7.5 percent in the first quarter of 2013
compared with a year earlier, according to the American Resort
Diamond Resorts recorded a profit of $2.3 million in the
quarter ended March 31, compared with a net loss of $9.6 million
in the same quarter last year. Revenue rose 41 percent to $153.5
The company said it plans to use part of the proceeds from
the IPO to repay debt and for expansion.
Diamond Resorts lost out to BFC Financial Corp
last year in a race to buy rival Bluegreen Corp.
Credit Suisse Securities was lead underwriter to the
Diamond Resorts' shares were trading at $14.50 after about
30 minutes. Nearly 1.6 million shares had changed hands.
Shares of industrial real estate investment trust Rexford
Industrial Realty Inc, which also began trading on
Friday, rose as much as 5 percent to $14.80.
The 16 million shares on offer were priced at $14 each, the
midpoint of the expected range, raising $224 million.