A Solid IPO Could Be In Store For Cadence Bancorporation

Cadence Bancorporation (Pending:CADE) expects to raise $150 million in its upcoming IPO ($172.5 million if the underwriters exercise their option to purchase additional shares).

Based in Houston, Texas, Cadence Bancorporation is a financial holding company that offers commercial and personal banking, mortgage financing, investment management, and insurance services through its subsidiaries.

We previewed this deal on our IPO Insights platform.

Cadence Bancorporation will offer 7.5 million shares at an expected price range of $19 to $21. If the underwriters price the IPO at the midpoint of that range, CADE will have a market capitalization of $1.7 billion.

CADE filed for the IPO on March 17, 2017.

Lead Underwriters: Goldman Sachs (GS) and J.P. Morgan Securities.

Underwriters: Keefe Bruyette & Woods, Raymond James & Associates, Robert W. Baird & Company, Sandler O’Neil & Partners, Stephens Inc., SunTrust Robinson Humphreys, and Tudor Pickering Holt & Company.

Business Summary & Use of Proceeds

According to company filings, Cadence Bancorp offers commercial and personal banking, mortgage financing, investment management, and insurance services through its subsidiaries. The firm has a network of 66 branches as of December 31, 2016, with 25 branches in Alabama, 14 branches in Florida, 12 branches in Texas, 11 branches in Mississippi, and 4 branches in Tennessee.

The company also has $9.5 billion in assets, $8.0 billion in deposits, $7.4 billion in gross loans, and $1.1 billion in shareholder’s equity.

The company considers its commercial banking segment to be its core driver, and it represents 77% of the total loan portfolio. Other segments include retail banking, financial services, investment management, and trust services. The company has over 1,100 employees, which includes 55 commercial relationship managers who oversee more than 6,100 commercial accounts.

The company aims to use proceeds from the IPO for organic growth and general corporate purposes, including the repayment of debt, maintaining required regulatory capital, and potential future acquisition opportunities.