TEFRON STOCK GAINS ON 1ST TRADING DAY
NEW YORK — Fueled by strong demand, the initial public offering of 5.25 million shares of innerwear maker Tefron Ltd. was priced at $17, with the first trade Wednesday running up to 20 1/4.
Israel-based Tefron supplies cotton women’s briefs to Warnaco Group for its licensed Calvin Klein line.
The offering price was above the estimated range of $14-$16, and 250,000 more shares were sold than originally expected. The stock closed at 20 7/16 on a turnover of 3.6 million shares on the New York Stock Exchange.
The company is selling 3.4 million shares, and shareholders are selling 1.9 million. The shareholders have granted the underwriters the option to purchase up to an additional 787,000 shares to cover overallotments.
Tefron also sells to Banana Republic, Cacique, Gap and Sara Lee’s Playtex apparel division. The principal shareholder of Tefron is Macpell, a Tel Aviv-based company, which owns 51 percent of Tefron. The Limited Inc. owns 42 percent of Macpell. Of the 1.9 million shares being sold by insiders, Macpell planned to sell 850,000.
The company will receive about $57.8 million before underwriting expenses. It plans to use the proceeds to buy machinery and equipment to build a new plant, to repay debt, finance acquisitions or new technology and form joint ventures.
In the year ended Dec. 31, Tefron earned $13 million on sales of $63.1 million.