Core & Main logo in front of the NYSE
Source: Core & Main

Core & Main IPO: Trading Starts, All the Details for Investors

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Jul. 23 2021, Published 1:56 p.m. ET

Fire and water protection infrastructure company Core & Main started trading on the NYSE on July 23 under the ticker symbol “CNM.”

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Shares of Core & Main started trading at $20 per share, which was the low end of the price range that the company originally sought when it announced its IPO last week. By 1:00 p.m. ET, the share prices were trading at slightly over $23 per share.

The company is selling over 34.88 million shares to raise $698 million. The company is valued at $4.81 billion. Here's what investors can expect moving forward.

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core and main
Source: Core & Main

What is Core & Main?

Core & Main is a distributor of water, wastewater, storm drainage and fire protection products, and related services. Its customers include municipalities, private water companies, and professional contractors across the country.

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The mission of the St. Louis-based company is “to foster a world where communities thrive because our people and products provide safe, sustainable infrastructure for generations to come,” according to the Core & Main website.

The company is a conglomerate of over 80 legacy companies. Private equity firm Clayton, Dubilier & Rice (CD&R) bought it in 2017 from HD Supply Holdings.

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Core & Main is one of only two national distributors operating across a large and highly fragmented $27 billion market. The company’s network includes 285 branch locations in 47 states and approximately 170 metro areas across the U.S. It provides a link between over 4,500 suppliers and over 60,000 customers.

“Given our scale, technical expertise and the specialized and critical nature of the products we distribute, we believe we have been, and will continue to be, well-positioned to drive the adoption of new technologies that enhance the way water is managed, distributed and used,” the company says in its prospectus filed with the SEC.

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Source: Twitter

Core & Main has acquired 12 companies since 2017.

Core & Main reports net sales growth at a CAGR (compound annual growth rate) of 9.6 percent from fiscal 2017 through May 2, 2021. During that time, the company acquired 12 other companies. Two of the largest acquisitions were Long Island Pipe Supply Inc. in July 2019 and R&B Co. in March 2020.

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CD&R will still own 79.6 percent of Core & Main.

After the IPO closes on July 27, CD&R will still control 79.6 percent of the company. The lead underwriters Goldman Sachs & Co., Credit Suisse, and J.P. Morgan will be granted a 30-day option to purchase an additional over 5.23 million shares at the IPO price.

The fire protection market is expected to grow.

The global fire protection market, which is a key part of Core & Main business, is expected to grow by over 12 percent between 2019 and 2025, according to Market Research Future (MRFR).

How to buy Core & Main stock

If you’re interested in buying Core & Main stock shares, you can do so through any traditional brokerage or online brokers like Robinhood or WeBull. The IPO is scheduled to close on July 27.

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