Cummins braving debt ceiling jitters with $275 mln engine filter unit IPO (updated)

Atmus Filtration Technologies

26/05/2023 03:56

(Adds IPO pricing details from company statement)
    By Echo Wang
       May 25 (Reuters) - 
    Diesel engine maker Cummins Inc  CMI.N  priced the initial
public offering (IPO) of its engine filtration division to raise
about $275 million, the company said on Thursday, defying
volatile markets which are being shaken by uncertainty over a
deal on the U.S. debt ceiling. 
    Atmus Filtration Technologies sold 14.1 million shares at
$19.5 a piece, the company said in a press release. The company
had previously guided the IPO could be priced at between $18 and
$21 per share.
        The IPO values Atmus at $1.6 billion. The stock is
scheduled to start trading on Friday on the New York Stock
Exchange under the symbol "ATMU". 
  
    Financial markets have been on edge over the timing of a
deal between the White House and Republicans in Congress to
raise the debt ceiling ahead of the June 1 deadline set by the
U.S. Treasury. 
    Despite the elevated volatility, however, the Cboe
Volatility Index, known as Wall Street's "fear gauge," remains
below 20, the level many bankers say makes it difficult to price
IPOs.
    The VIX has been above 20 most of the time since the first
quarter of 2022 as the war in Ukraine and interest rate hikes by
central banks fueled market jitters. This created an IPO
drought, with only a few stock market hopefuls bucking the
trend. 
    Companies have raised about $2.2 billion in the first
quarter this year, compared to more than $42.6 billion during
the same period in 2021, according to Dealogic.
    The Atmus IPO follows in the steps of Johnson & Johnson's
 JNJ.N  consumer health business Kenvue Inc  KVUE.N , which
raised $3.8 billion earlier this month in the largest IPO of
this year. 
    Atmus provides filtration products for trucks, off-highway
industrial equipment and power generation systems.
    Columbus, Indiana-based Cummins will control about 83% of
the company's shares after the listing on the New York Stock
Exchange. 
    Goldman Sachs & Co. GS.N , and JPMorgan Chase & Co. JPM.N ,
are the lead underwriters for the IPO.

 (Reporting by Echo Wang in New York; Additional Reporting by
Rishabh Jaiswal; Editing by Paul Simao and Kim Coghill)
 ((E.Wang@thomsonreuters.com; +13322191785; Reuters Messaging:
@deer_echo_))