The IPO Buzz: Waystar (WAY) Prices IPO at $21.50 Mid-Point to Raise $968 Million

Waystar (WAY), a U.S. healthcare payments software provider, priced its IPO at $21.50 – the mid-point of its $20.00-to-$23.00 range – and sold 45.0 million shares – the number of shares in the prospectus – to raise $967.5 million on Thursday night, June 6, 2024. This is the largest IPO of the year. The stock is expected to start trading Friday, June 7, on the NASDAQ. J.P. Morgan, Goldman Sachs and Barclays were the joint lead book-runners. William Blair, Evercore ISI, BofA Securities, RBC Capital Markets and Deutsche Bank Securities rounded out the team of joint book-runners. Canaccord Genuity and Raymond James were the co-managers. Cornerstone investors – one or more funds or accounts advised by Neuberger Berman Investment Advisers and a wholly owned subsidiary of Qatar Investment Authority – had severally and not jointly indicated an interest in buying up to $225 million of stock in the IPO, the prospectus says. The IPO proceeds will be used to repay debt under Waystar’s First Lien Credit Agreement, the prospectus says. As of March 31, 2024, Waystar had $2.2 billion of outstanding borrowings on the first lien term loan, according to the prospectus. Private equity got a nice payday with the IPO pricing: *EQT Investor, a fund affiliated with private equity giant EQT, owned a 40 percent pre-IPO stake in Waystar, and after the IPO, its stake will be about 29.2 percent, while *CPPIB Investor (affiliated with The Canada Pension Plan Investment Board) (CPPIB) owned a 30.6 percent pre-IPO stake, and after the IPO, that stake will be about 22.3 percent, and *Bain Investors, affiliated with Bain Capital, owned a 23 percent pre-IPO stake in Waystar, and after the IPO, that stake will be about 16.8 percent, according to the prospectus. Waystar, based in Lehi, Utah, provides cloud-based payments software to physician practices, clinics, surgical centers and labs as well as to large hospitals and health systems. “Put simply, our software helps providers get paid faster, accurately, and more efficiently, while ensuring patients receive a modern, transparent, and consumer-friendly financial experience,” Waystar says in the prospectus. “We currently serve approximately 30,000 clients of various sizes, representing approximately one million distinct providers practicing across a variety of care sites, including 18 of the top 22 U.S. News Best Hospitals,” Waystar says in the prospectus.  The company filed to go public last October. Waystar is not profitable. For the 12 months that ended March 31, 2024, Waystar reported a net loss of $56.64 million on revenue of $824.72 million.