Cloud-based payroll processor TriNet IPO valued at $1.09 billion; the company served more than 8,900 clients in 47 states

April 9, 2014 Leave a comment

Cloud-based payroll processor TriNet IPO priced at $16 per share

8:04pm EDT

(Reuters) – Cloud-based payroll processor TriNet Group Inc (TNET.N: Quote, Profile, Research, Stock Buzz) said it priced its initial public offering at $16 per share, valuing the company at about $1.09 billion.

Backed by private equity firm General Atlantic LLC, TriNet’s expected offering of 15 million shares would raise about $240 million at that price, which is at the mid-point of its planned $15-$17 price range.

The stake held by General Atlantic, the company’s top shareholder, will drop to 56 percent after the offering from 71.4 percent.

TriNet’s shares will start trading on the New York Stock Exchange on Thursday under the symbol “TNET.”

Small and medium-sized businesses outsource payroll, employee-benefit and other human resources functions to San Leandro, California-based TriNet, which offers a cloud-based technology platform. The company served more than 8,900 clients in 47 states, the District of Columbia and Canada as of December 31, it said in a filing.

The company, which counts Automatic Data Processing Inc (ADP.O: Quote, Profile, Research, Stock Buzz), Insperity Inc (NSP.N: Quote, Profile, Research, Stock Buzz) and Paychex Inc (PAYX.O: Quote, Profile,Research, Stock Buzz) among its main competitors, said net proceeds from the offering would be used to repay outstanding debt.

TriNet has been highly acquisitive, buying premium HR services company Ambrose Employer Group LLC, technology firm App7 Inc and insurance and risk-management service provider Gevity HR Inc.

Shares of online payroll processor Paylocity Holding Corp (PCTY.O: Quote, Profile, Research, Stock Buzz) soared in their debut last week as investors kept their faith on cloud-based enterprise software companies.

TriNet’s net income fell to $13.15 million in 2013, from $31.83 million a year earlier. Revenue rose, however, by 61 percent to $1.64 billion last year.

JP Morgan, Morgan Stanley and Deutsche Bank Securities are among the lead underwriters for the offering.

 

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Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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