Minnesota has two more public companies

Two Minnesota-based companies completed initial public offerings of stock this week, furthering Minnesota's participation in a resurgent market for IPOs.

Edina-based Agiliti Inc. (stock symbol, AGTI), a provider of medical equipment and service solutions to the health care industry, became a public company again when it completed an IPO on the New York Stock Exchange Friday.

Bloomington-based SkyWater Technology (stock symbol, SKYT), a maker of computer chips, priced its offering after the market closed Tuesday and had its first full day of trading Wednesday on the Nasdaq market.

This has been a boom year so far for IPOs. According to Renaissance Capital, which tracks initial public offerings, there have been 126 IPOs, up 350% from last year. The amount raised from those offerings, $86.2 billion, has risen more than 1,000% from this time in 2020.

SkyWater's offering was upsized. It priced at $14 per share, the top end of the offering range, and the company offered more shares than initially disclosed. With an overallotment, it sold more than 8 million shares, after an estimate that it would sell 6.7 million shares, and raised more than $112 million.

SkyWater will use proceeds of the offering for working capital and general corporate purposes including possible acquisitions or strategic investments. The company, with roots in the high-tech pioneer Control Data Corp., unveiled a $170 million expansion last year.

SkyWater's shares closed Friday at $20.96, up 8.4%.

Agiliti also priced its offering at $14 per share, a price substantially lower than had been indicated in prior filings. The offering was expected to price between $18 and $20 per share, but it did sell more than 26 million shares and raised $339 million, more when an overallotment is exercised by underwriters.

While the Agiliti offering priced poorly, when trading started shares immediately traded higher, as much as $16 per share in early trading Friday. The shares closed at $16.40, a 17.1% increase for the first day.

Agiliti's offering is the second-largest local IPO in the last two years.

Sun Country Airlines Holdings Inc. went public in March and raised more than $218 million. Wayzata-based specialty insurance company Trean Insurance Group went public in July and raised $161 million.

JAMF Holding Corp., which helps organizations connect, manage and protect their Apple devices, raised $468 million from its July IPO, making it the largest offering of the most recent Minnesota IPOs.

Agiliti was founded in Minneapolis in 1939 as the ABC Oxygen Tent Rental Service. It changed its name to Universal Hospital Services in 1969 and to Agiliti in 2018.

The company was publicly traded at one point as Universal Hospital Services, but was taken private and had several private-equity owners, the last an affiliate of Boston-based private-equity firm Thomas H. Lee Partners (THL).

Agiliti's IPO process was more complex and lengthy than most and involved a special-purpose acquisition company of THL to bring Agiliti public.

The company had tried to go public in 2018, but the offering was pulled due to market conditions.

When overallotments are sold, the company will have raised less than $400 million, according to Tom Leonard, chief executive of Agiliti.

"Our goal in the IPO is to use those proceeds to pay down the debt that is the byproduct of being a private equity-owned company and give us the financial flexibility to support our strategy of opportunistic M&A to augment our core, organic growth profile," Leonard said.

Leonard has been CEO of the company since 2015 and under his tenure Agiliti has made seven tuck-in acquisitions, most recently with Northfield Medical Inc.

Accessing the public markets will give Agiliti more financial flexibility and access to cheaper capital and allow Leonard to pursue more acquisitions.

On completion of the offering, Thomas H. Lee Partners will still own more than three-fourths of Agiliti's shares and Agiliti will be considered a controlled company.

Agiliti's business is to manage, maintain and mobilize medical devices for health care companies. It owns more than 800,000 pieces of medical equipment and serves more than 7,000 hospitals and other health care sites.

Leonard said that work puts Agiliti on the right side of health care.

"We are driving cost savings, we are delivering operating efficiencies, we are improving patient safety when it comes to medical devices for our customers," Leonard said. "The services that we provide are always necessary and in high demand."

In 2020, Agiliti had revenue of $773 million, a 26% increase over the prior year. They lost $22.5 million, an improvement over the loss of $31.4 million in 2019. Agiliti has 3,852 employees and had more than 90 services centers across the U.S. at the end of 2020.

Agiliti also manages the emergency stockpiles of medical equipment for federal, state and some city agencies.

Patrick Kennedy • 612-673-7926