IPO for Rao's Parent Sovos Brands (SOVO) Opens 23% Higher, Valuing Co. at 1.4$B

September 23, 2021 12:06 PM EDT

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Today's IPO for Sovos Brands, Inc. (NASDAQ: SOVO), the maker of Rao's and other food brands, opened for trading at $14.75 after pricing 23,334,000 shares of its common stock at a price to the public of $12 per share, below the expected $14-$16 range.

The valuation of Sovos Brands based on the opening stock price is $1.44 billion.

J.P. Morgan and Goldman Sachs are acting as joint lead book-running managers for the offering and as representatives of the underwriters. BofA Securities, Credit Suisse, Barclays, UBS Investment Bank, Cowen, Piper Sandler, Stifel and William Blair will also act as book-running managers and Telsey Advisory Group, Drexel Hamilton and Loop Capital Markets will act as co-managers for the offering.

Sovos Brands, headquartered in Louisville, Colorado, is the fastest growing food company of scale in the United States. As a high growth, purposefully-built food platform and growth accelerator with a portfolio of “one-of-a-kind” brands, all four of the brands – Rao’s, Michael Angelo’s, noosa and Birch Benders – are built with authenticity and high-quality ingredients at their core. Its portfolio includes Rao’s, a premium line of pasta sauces, pizza sauces, dry pastas, frozen entrees and soups; noosa, a premium yoghurt made with whole milk and wildflower honey; Birch Benders, a line of better-for-you pancake and waffle mixes; and Michael Angelo’s, a line of premium frozen Italian entrées.

Net sales increased from $203 million in the year ended December 29, 2018 to $560 million in the year ended December 26, 2020, representing a CAGR of 66%. Net income increased from a $27 million loss in the year ended December 28, 2019 to an $11 million profit in the year ended December 26, 2020.

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