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Shake Shack (SHAK) Prices 5M Common IPO at $21/Share; Above Expected Range

January 30, 2015 6:20 AM EST

Shake Shack Inc. (NYSE: SHAK) announced the pricing of its initial public offering of 5,000,000 shares of its Class A common stock at a public offering price of $21 per share. The shares are expected to begin trading on the New York Stock Exchange on January 30, 2015 under the ticker symbol “SHAK.” In addition, Shake Shack has granted the underwriters a 30-day option to purchase from Shake Shack up to an additional 750,000 shares of its Class A common stock at the initial public offering price, less the underwriting discount.

*** The company was previously looking for a price range of $17 to $19 per share.

The closing of the offering is expected to occur on February 4, 2015, subject to the satisfaction of customary closing conditions.

J.P. Morgan Securities LLC and Morgan Stanley & Co. LLC are acting as joint lead book-running managers in the proposed offering. Barclays Capital Inc., Goldman, Sachs & Co., and Jefferies LLC are also acting as book-running managers in the proposed offering. William Blair & Company, L.L.C. and Stifel are acting as co-managers in the proposed offering.

Shake Shack is a modern day "roadside" burger stand serving a classic American menu of premium burgers, hot dogs, crinkle-cut fries, shakes, frozen custard, beer and wine. Founded by Danny Meyer's Union Square Hospitality Group, LLC ("USHG"), Shake Shack was created leveraging USHG's expertise in community building, hospitality, fine dining, restaurant operations and sourcing premium ingredients.

Of the 63 Shacks, there are 31 domestic company-operated Shacks, five domestic licensed Shacks and 27 international licensed Shacks. The company opens Shacks in areas where communities gather, often with high foot traffic and substantial commercial density such as New York City's Theater District, London's Covent Garden and Dubai's Mall of the Emirates. The company has been able to successfully grow across a variety of locations due to its versatile Shack formats and designs that are tailored to reflect each Shack community's core attributes. During the three fiscal years ended December 25, 2013, we grew from seven Shacks in two states to 40 Shacks across six states, Washington, D.C. and eight other countries, representing a 79% compound annual growth rate ("CAGR"). In fiscal 2013, domestic company-operated Shacks had AUVs of approximately $5.0 million, of which the Manhattan Shacks had AUVs of approximately $7.4 million and non-Manhattan Shacks had AUVs of approximately $3.8 million. During the three fiscal years ended December 25, 2013, total revenue grew from $19.5 million to $82.5 million, a 62% CAGR, net income grew from $0.2 million to $5.4 million, and Adjusted EBITDA grew to $14.5 million.



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