3/6/2024

Baird ECM Displays Continued Execution Leadership in Recent Industrial Offerings

Baird’s Equity Capital Markets team recently led two follow-on offerings in the Industrial sector for REV Group and Kratos, bolstering its leadership as a trusted partner for issuers. Baird’s strong institutional reach and leading distribution capabilities help companies and sponsors achieve capital raise and liquidity goals through best-in-class execution.

In the below, we outline execution and offering highlights of these two transactions.

Rev Group

REV Group Completes $303.6 Million Follow-On Offering

Left Lead Bookrunner:	Baird
Active Bookrunners:	Goldman Sachs Morgan Stanley
Pricing Date:	February 14, 2024
Offering Size ⁽¹⁾:	$303.6
Primary / Secondary:	100% Secondary
Selling Shareholder:	American Industrial Partners (“AIP”)
Offer Price:	$16.50
Deal Size % of Market Cap ⁽²⁾:	26.2%
File-to-Offer Discount:	(2.1%)
Offer-to-1 Day:	+10.7%
Offer-to-7 Day:	+16.9%

Offering Highlights

Confidential marketing and one day of public marketing resulted in numerous 1x1 meetings with management
The offering was upsized by 33% as a result of strong institutional demand, with the order book finishing well oversubscribed on the upsized offering
Third marketed follow-on on behalf of AIP, bringing ownership down from 46.1% to 17.7% ⁽¹⁾
Concurrent 8 million share repurchase by the Company, reducing shares outstanding by ~10%
Allocations were concentrated to wall-crossed accounts and fundamental, long-only accounts

Kratos Defense & Security Solutions

Kratos Completes $345.0 Million Follow-On Offering

Left Lead Bookrunner:	Baird
Active Bookrunners:	RBC Capital Markets Truist Securities
Pricing Date:	February 22, 2024
Offering Size ⁽¹⁾:	$345.0
Primary / Secondary:	100% Primary
Offer Price:	$18.00
Deal Size % of Market Cap ⁽²⁾:	11.4%
File-to-Offer Discount:	(10.8%)
Offer-to-1 Day:	+0.3%
Offer-to-7 Day:	+1.3%

Offering Highlights

Confidential marketing and one day of public marketing resulted in numerous 1x1 meetings with management
Timely capital raise for the Company at its current stage of development and opportunity to bolster balance sheet to focus on execution
The deal was fully covered prior to the public flip, finishing multiple times oversubscribed following public marketing
Highly concentrated allocations placing an emphasis on investors that wall crossed, met with management and accounts with a long-term investment focus
The order book had a mix of both new and existing investors, expanding Kratos’ institutional holder base to increased liquidity