Billionaire-Backed Private Equity Giant TPG Targets Up To $9.5 Billion Valuation In Highly Anticipated IPO

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Topline

Storied buyout firm TPG unveiled new details for its looming initial public offering, disclosing on Tuesday it hopes to raise as much as $877 million—nearly nine times the figure it teased less than two months ago—at a valuation of up to $9.5 billion in what’s sure to be one of the year’s biggest public market debuts.

Jim Coulter, chairman of TPG Capital, listens as David Bonderman, founding partner of TPG Capital, … [+] speaks during a panel discussion in Washington, D.C.

Key Facts

In a Tuesday announcement, the investment firm founded by billionaires James Coulter and David Bonderman said it has started offering 33.9 million shares of stock, including 28.3 million shares offered by the company, to the public at an expected price of $28 to $31 per share—indicating the firm could raise between $792 million and $877.6 million.

With nearly 307 million shares outstanding, TPG would be valued at more than $9.5 billion given the offering’s high end of pricing.

The Texas and San Francisco-based firm said it plans to use about 40% of the offering’s proceeds to buy up its own partnership interests and the remaining funds for offering expenses and general expenses.

TPG, which did not immediately respond to Forbes’ request for comment, has tapped JP Morgan, Goldman Sachs and Morgan Stanley as underwriters for the offering.

Surprising Fact

Holding some $109 billion in assets, TPG would become the fourth-largest publicly traded private equity firm in the U.S. by assets, behind Blackstone ($619 billion), Carlyle Group ($256 billion) and KKR ($252 billion).

Key Background

In late November, TPG announced plans to go public by saying it had confidentially filed to list on the Nasdaq exchange under the ticker TPG. Though it’s kept many details under wraps, the firm listed an offering size of $100 million, but suggested that could likely increase depending on investor interest. The company owns outsize stakes in talent agency CAA, Vice Media and Spotify, and its debut would breathe new life into private equity public listings after a massive boom in buyout deals.

Tangent

TPG’s initial public offering comes after a record year for deal-making. Last year ushered in more than $5.6 trillion worth of merger and acquisition transactions, surpassing the previous record of $4.6 trillion in 2007, according to markets data firm Dealogic. That’s only expected to continue. Cash-rich private equity firms have a record $2.3 trillion in cash and other liquid assets prime for spending.