(Reuters) - Shares of GFL Environmental Inc GFL.NGFL.TO on Tuesday fell nearly 8% in their debut on the New York and Toronto stock exchanges, even after pricing its initial public offering below the targeted range.
GFL shares opened at $17.5 giving the Canadian waste management company a market capitalization of $5.81 billion.
GFL is the fourth biggest market debut globally so far in 2020.
Founded by former hockey player Patrick Dovigi, GFL is one of the largest waste haulers in North America, serving over 4 million households, more than 135,000 commercial customers in its solid waste management business, and over 13,000 customers in its liquid waste management business.
GFL on Monday priced its IPO at $19 each, or C$25.33, below the target range in a conservative step to ride out market volatility in the wake of the coronavirus outbreak.
The share issue raised about $1.43 billion, or C$1.90 billion.
Separately, the company also sold about 15.5 million tangible equity units at $50 per unit, raising about $775 million in proceeds.
(GRAPHIC: Top 5 Market Debuts in 2020 - )
Interactive graphic tmsnrt.rs/2TBfLiG on 2020 IPO market
GFL’s debut coincided with the U.S. Federal Reserve’s emergency interest rates cut in a bid to shield the world’s largest economy from the impact of the coronavirus.
“It’s just an environment where it appears the market is not wanting to put risk on, even if it is a defensive asset like GFL,” said Jeff Zell, senior research analyst at IPO Boutique.
GFL, whose “Green for Life” slogan is seen across major Canadian cities, had previously attempted to raise $1.83 billion, but that IPO was pulled in November after institutional investors pressed the Canadian firm to price its shares below the marketed range.
The company, which competes with Waste Management Inc WM.N, intends to use the proceeds from the offering to pay down debt.
J.P. Morgan, BMO Capital Markets, Goldman Sachs, RBC Capital Markets and Scotiabank are lead underwriters to the offering.
Reporting by C Nivedita in Bengaluru; Editing by Shailesh Kuber
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