Om, Om, Om, Ouch! YogaWorks pummeled
YogaWorks did the downward-facing dog in its first pose as a public company.
Shares of the Santa Monica, Calif.-based yoga studio chain fell as much as 20 percent — to below $5 — Friday in their first day of trading on the Nasdaq.
The drop was a doozy, considering that YogaWorks had intended to go public only three weeks ago, with shares priced between $12 and $14.
YogaWorks owns 45 studios nationwide and five in the New York City area, where one class costs $28. The company’s plan to offer 5 million shares to the public in July was delayed because of market conditions.
Blue Apron and Snapchat’s parent company, Snap, likewise recently went public with disastrous results. Shares of both companies now trade roughly 50 percent below their first days of trading.
But despite YogaWorks’ initial hesitation and the weak market for trendy initial public offerings, the company, owned by private-equity firm Great Hill, pushed forward.
“This is a significant milestone for YogaWorks, and we are excited to become a publicly traded company today,” CEO Rosanna McCollough insisted Friday.
Reaching that milestone meant slashing its IPO price by 57.5 percent, to $5.50 a share, the greatest cut to an IPO — on a percentage basis — since April 2015, according to data from IPO advisory firm Renaissance Capital.
To get the IPO done, Great Hill expressed interest in acquiring as much as $15 million worth of shares, regulatory filings show.
“Private equity firms have been anxious to realize returns on their investments,” Kathleen Smith of Renaissance Capital told The Post. “It looks to us that the private equity firm was interested in getting liquidity.”
YogaWorks raised $40 million in the deal, missing its goal of $65 million. Making matters worse, it had to offer 7.3 million shares instead of the originally planned 5 million to reach the lowered target.
YogaWorks’ shares ended Friday down 11.82 percent, at $4.85.