The company provides a variety of specialty insurance coverage for industry verticals.
PROS has produced enviable results, has stable loss ratios, an intriguing go-to-market approach and is generating significant earnings, so I'll be acquiring a small position in the IPO or post-IPO.
Company & Technology
Morristown, New Jersey-based ProSight Global was founded in 2009 to provide clients with insurance coverage focused on specific industry verticals.
Management is headed by co-founder, president and CEO Lawrence Hannon, who was previously Chief Sales and Marketing Officer at the Fireman’s Fund Insurance Company and before that held leadership positions at Chubb Limited.
The firm’s primary investors are private equity firms TPG and funds affiliated with Goldman Sachs, who is also the lead left underwriter for the IPO.
As of the 2017 report, ProSight was ranked in the top ten firms in certain states and U.S. possessions for various specialty insurance categories.
The firm currently provides coverage in seven industries and revenue distribution is more or less evenly distributed between them:
- Media and Entertainment
- Real Estate
- Professional Services
- Transportation
- Construction
- Consumer Services
- Marine and Energy
As of March 31, 2019, the company had $34.1 million in cash, $1.9 billion in total investments and $2.3 billion in total liabilities.
Free cash flow during the twelve months ended March 31, 2019, was $258.9 million.
IPO Details
PROS intends to sell 8.8 million shares of common stock at a midpoint price of $17.00 per share for gross proceeds of approximately $150.0 million, not including the sale of customary underwriter options.
Assuming a successful IPO at the midpoint of the proposed price range, the company’s enterprise value at IPO would approximate $868.8 million.
Excluding effects of underwriter options and private placement shares or restricted stock, if any, the float to outstanding shares ratio will be approximately 20.82%.
Per the firm’s most recent regulatory filing, it plans to use the net proceeds for general corporate purposes, so it has not provided any detail on its plans.
Management’s presentation of the company roadshow is available here.
Listed underwriters of the IPO are Goldman Sachs, Barclays, BofA Merrill Lynch, Dowling & Partners, Keefe, Bruyette & Woods, SunTrust Robinson Humphrey, and Citizens Capital Markets.