Paycor Announces Offering of Common Stock by Selling Stockholders
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The announcement of an underwritten public offering by Paycor HCM, Inc. represents a significant liquidity event for the investment funds advised by Apax Partners LLP. The decision to offload 8,000,000 shares is a strategic move that could indicate Apax Partners' assessment of Paycor's current valuation or a need to free up capital for other investments. The market's reception of this offering will serve as a barometer for investor sentiment towards Paycor and could influence the stock's price volatility in the short-term.
From a financial perspective, the distribution of 11,038,476 shares to limited partners prior to the offering's close is a substantial reallocation of equity. This could potentially dilute the value of existing shares, depending on how the market absorbs the additional supply. Moreover, the 30-day lock-up on a portion of shares may provide some temporary price stability post-offering. However, once this period expires, there could be increased selling pressure if these shareholders decide to liquidate their positions.
Paycor's decision to not receive proceeds from the sale and to bear the costs associated with the sale (excluding underwriting discounts and commissions) is an interesting strategic choice. This indicates that the primary objective of the offering is to facilitate the exit or portfolio adjustment of the selling stockholders rather than to raise capital for the company itself. For current and potential investors, this move could signal that Paycor is in a stable financial position with sufficient operating capital, thus not requiring the infusion of funds through this offering.
Additionally, the role of Goldman Sachs & Co. LLC as the underwriter is noteworthy. Their involvement lends credibility to the offering and could potentially attract institutional investors. The market will closely monitor the performance of this offering, as it may set a precedent for future transactions involving similar companies in the HCM software sector.
The offering is being made pursuant to a shelf registration statement on Form S-3, which allows for the registered securities to be offered in one or more separate offerings with the size, price and terms determined at the time of sale. This flexibility is advantageous for the selling stockholders, as it enables them to respond quickly to market conditions. Investors should be aware that the prospectus filed with the SEC contains critical information and any discrepancies or updates in these documents could have legal implications and affect investor decisions.
It is also important to consider the legal implications of the lock-up agreements. While these are standard practice to prevent a flood of shares hitting the market immediately after an offering, they can also lead to a concentrated period of volatility once they expire, as mentioned earlier. Stakeholders should monitor the SEC filings for any amendments or additional information that could provide further context to the offering.
CINCINNATI, March 06, 2024 (GLOBE NEWSWIRE) -- Paycor HCM, Inc. (Nasdaq: PYCR) (“Paycor”), a leading provider of human capital management (HCM) software, today announced the commencement of an underwritten public offering of 8,000,000 shares of common stock on behalf of investment funds advised by Apax Partners LLP. The offering consists of 5,651,106 shares offered by Pride Feeder, LP and 2,348,894 shares offered by AIX Pride Syndication L.P., respectively. Each of the selling stockholders are controlled by investment funds advised by Apax Partners LLP. Paycor will not receive any of the proceeds from the sale of the shares being offered by the selling stockholders but will bear the costs associated with the sale of such shares, other than any underwriting discounts and commissions.
Goldman Sachs & Co. LLC is acting as underwriter for the proposed offering.
Pride Aggregator, LP will distribute 11,038,476 shares of Paycor’s common stock to its limited partners prior to the closing of the proposed offering, including the selling stockholders. Of the 11,038,476 shares that will be distributed, (i) 8,000,000 shares will be offered for sale in the proposed offering, (ii) 2,517,635 shares that are not being offered for sale in the proposed offering will be subject to a 30-day lock-up and (iii) 520,841 shares that are not being offered for sale in the proposed offering will be distributed among approximately 80 limited partners who will not be subject to lock-ups.
The proposed offering of common stock will be made pursuant to the Company’s shelf registration statement on Form S-3 filed with the Securities and Exchange Commission (“SEC”) and declared effective. Before you invest, you should read the prospectus in that registration statement and other documents the Company has filed with the SEC for more complete information about the Company and this offering. The proposed offering will be made only by means of a prospectus and a free writing prospectus. A copy of the prospectus and the free writing prospectus relating to this offering may be obtained, when available, by visiting the SEC’s website at www.sec.gov. Alternatively, the prospectus and the free writing prospectus may be obtained from: Goldman Sachs & Co. LLC, Prospectus Department, 200 West Street, New York, NY 10282, telephone: 1-866-471-2526, facsimile: 212-902-9316 or by emailing Prospectus-ny@ny.email.gs.com.
This press release shall not constitute an offer to sell or a solicitation of an offer to buy these securities, nor shall there be any offer or sale of these securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to the registration or qualification under the securities laws of any such state or jurisdiction.
Note Regarding Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements reflect Paycor’s current intentions, expectations or beliefs regarding the proposed common stock offering. These statements may be preceded by, followed by or include the words “aim,” “anticipate,” “believe,” “estimate,” “expect,” “forecast,” “intend,” “likely,” “outlook,” “plan,” “potential,” “project,” “projection,” “seek,” “can,” “could,” “may,” “should,” “would,” “will,” the negatives thereof and other words and terms of similar meaning. Forward-looking statements include all statements that are not historical facts. Such forward-looking statements are subject to various risks and uncertainties. Accordingly, there are or will be important factors that could cause actual outcomes or results to differ materially from those indicated in these statements. There is no assurance that any forward-looking statements will materialize. You are cautioned not to place undue reliance on forward-looking statements, which reflect expectations only as of this date. Paycor does not undertake any obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments, or otherwise.
About Paycor
Paycor’s human capital management (HCM) platform modernizes every aspect of people management, from recruiting, onboarding, and payroll to career development and retention, but what really sets us apart is our focus on leaders. For more than 30 years, we’ve been listening to and partnering with leaders, so we know what they need: a unified HR platform, easy integration with third party apps, powerful analytics, talent development tools, and configurable technology that supports specific industry needs. That’s why more than 30,000 customers trust Paycor to help them solve problems and achieve their goals.
Investor Relations:
Rachel White
513-954-7388
IR@paycor.com
FAQ
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Will Paycor (PYCR) receive any proceeds from the sale of shares in the public offering?
How many shares will be subject to a 30-day lock-up in the proposed offering by Paycor (PYCR)?
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