Chewy prices initial public offering (IPO) at $22 per share

Source: Chewy (GIF on Twitter)

Petsmart’s online pet products retailer Chewy priced its initial public offering (IPO) at $22 per share, above its target range of around $19 to $21 per share.

In a statement on Thursday, Chewy said it will be offering 46.5 million shares of its Class A common stock on the New York Stock Exchange (NYSE) under the symbol “CHWY.” Its trading debut is on Friday, June 14.

Petsmart is the owner of Chewy, which will be trading under a dual-class structure after the IPO. According to the online pet products retailer, it will be trading 5.6 million of its Class A shares while Petsmart will be offering 40.9 million Class A shares.

Petsmart owns 278 million Class B shares of the online pet products retailer, which represent around 70 percent of the company’s Class A common stock. Petsmart is its largest shareholder, holding approximately 77 percent voting power.

Chewy said its net sales have been growing

Chewy it is expected to raise $873.6 million in net proceeds from its market debut.The company plans to use its net proceeds for general corporate purposes and working capital, according to its Form S-1 filing with Securities and Exchange Commission (SEC).

In the filing, the company disclosed that it is offering more than 45,000 products on its website. Since inception in 2011, it already delivered 100 million orders to its customers.

From fiscal year 2012 to fiscal year 2018, Chewy’s net sales increased from $26 million to $3.5 billion. Its net sales per customer climbed from $223 to $334.

Additionally, the company said its Autoship customer sales grew from $115 million in fiscal year 2014 to $2.3 billion in fiscal year 2018. Its net loss was $267.8 million last year compared to $338 million in 2017.

Under its risk factors, Chewy warned investors, “If we fail to acquire and retain new customers, or fail to do so in a cost-effective manner, we may be unable to increase net sales, improve margins and achieve profitability.”