IPO Alert: Allvue Systems sets IPO terms, to raise around $290 million

It is estimated that the alternative investments industry has expanded at a compound annual rate of 10.2% over the past ten years and had $11 trillion in assets under management as of December 2020. Allvue Systems Holdings, Inc, a software company that provides cloud-based investment management solutions for fund managers and administrators in the alternative investments industry, is preparing for an initial public offering.

Bluefin Deal

Backed by private equity firm Vista Equity Partners, Allvue is headquartered in Coral Gables, Florida. The company was formed for completing an IPO to carry on the business of its wholly-owned subsidiary Bluefin Topco, LLC. Post-IPO, Allvue will operate and control all of the businesses and affairs of Bluefin. The net proceeds from the offering will be used for buying newly-issued units in Bluefin, which in turn will use the amount for repaying debt.

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Allvue intends to offer 15.3 million shares at an estimated price in the range of $17 to $19 per share, which is expected to value the company at $2-3 billion. Once approved, the shares will start trading on the New York Stock Exchange under the ticker symbol ALVU later this month. The group of book-runners in the offering will be led by Goldman Sachs Group, Inc. (NYSE: GS), Barclays, and Credit Suisse.

Currently, chief executive officer Mark Heimbouch is at the helm of Allvue. Its SaaS offerings are used for analyzing and monitoring institutional investment activities. The solutions are designed for all types of investment managers, including general partners, limited partners, fund administrators, and banks. Enhanced analytics, better data accuracy, and consistency across workflows ensure superior results.

Growing Demand

With more and more institutional investors showing interest in alternate asset classes, the demand for technology-assisted solutions is expected to grow steadily. The growth strategy laid down by Allvue executives is focused on the continued expansion of client base, increasing geographical presence, pursuing strategic acquisitions, and enhancing the product portfolio.

However, as a public entity, Allvue might face stiff competition from the likes of SS&C Technologies, a better diversified financial technology company that has served around $45 trillion in managed assets.

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In the six months ended June 2021, Allvue’s revenues rose 14% from the prior ye-year period to $71.3 million. However, net loss widened to $20.8 million from $14.5 million in the corresponding six-month period of 2020, hurt by a double-digit increase in operating expenses.

Financials

Currently, the company has around 400 clients and the platform serves more than14,000 individual users. It had $10.6 million in cash and $286.7 million in total liabilities as of June 2021. The balance sheet is expected to look much stronger post-IPO because the proceeds would be used mainly for debt repayment.