| Key Points: – Lineage, the world’s largest temperature-controlled warehouse REIT, goes public with a $4.4 billion IPO – Shares rise up to 5% on first day of trading under ticker “LINE” – Largest IPO since Arm’s $4.8 billion listing in September 2023 – Company’s success driven by aggressive acquisition strategy, with 116 acquisitions to date |
In a landmark event for the 2024 stock market, Lineage, the global leader in temperature-controlled warehousing, made its public debut on the Nasdaq Stock Market. The company’s initial public offering (IPO) raised an impressive $4.4 billion, marking it as the largest public offering since chip designer Arm’s $4.8 billion listing in September 2023.
Lineage’s shares, trading under the ticker symbol “LINE,” saw an encouraging start, rising by as much as 5% during their first day of trading. The company priced 57 million shares at $78 each, near the top of its initial $70 to $82 target range. This pricing implies a valuation of over $18 billion for the cold storage giant.
The successful IPO is a testament to Lineage’s remarkable growth strategy and its critical role in the global food supply chain. Starting from a single warehouse, Lineage has expanded its operations through an aggressive acquisition approach, completing 116 acquisitions to date. This strategy has transformed Lineage into a global powerhouse with over 480 facilities across North America, Europe, and the Asia-Pacific region, boasting a total capacity of approximately 2.9 billion cubic feet.
Adam Forste, co-founder and co-executive chairman of Lineage, highlighted the company’s unique growth trajectory on CNBC’s “Squawk Box” just before trading began. “We started with one warehouse and we’ve done 116 acquisitions to turn Lineage into what it is today,” Forste explained. He also noted that many families who sold their companies to Lineage rolled their equity into the larger entity, creating a network of stakeholders celebrating the IPO together.
Lineage’s business model addresses a critical global issue: food waste in the supply chain. With an estimated $600 billion worth of food going to waste during or just after harvest, Lineage’s temperature-controlled storage facilities play a crucial role in reducing this waste and its associated environmental impact. Food waste currently accounts for about 11% of the world’s emissions, making it a significant contributor to climate change.
The company’s successful market debut comes at a time when IPOs have been relatively scarce, making Lineage’s offering particularly noteworthy. It’s more than twice the size of cruise operator Viking Holdings’ IPO in May, further emphasizing the scale of this public offering.
Lineage’s strong market reception also reflects investor confidence in the cold storage sector, which has seen increased demand due to changing consumer habits and the growth of online grocery shopping. The company’s global network of cold-storage facilities positions it well to capitalize on these trends and continue its expansion.
The IPO was underwritten by a group of major financial institutions, including Morgan Stanley, Goldman Sachs, Bank of America, J.P. Morgan, and Wells Fargo, further underscoring the significance of this offering.
As Lineage begins its journey as a public company, investors and industry observers will be watching closely to see how this cold storage giant navigates the challenges and opportunities of the public market. With its strong market position, proven growth strategy, and critical role in the global food supply chain, Lineage’s future looks promising as it embarks on this new chapter in its corporate history.
