What have you always wondered about the economy? Tell us

Dunkin’ Donuts’ IPO returns company to the public

Jennifer Collins Jul 4, 2011
HTML EMBED:
COPY

Dunkin’ Donuts’ IPO returns company to the public

Jennifer Collins Jul 4, 2011
HTML EMBED:
COPY

Steve Chiotakis: Dunkin’ Donuts could very well price an initial public offering as early as this week. Marketplace’s Jennifer Collins reports and she looks beyond the sprinkles of the deal.


Jennifer Collins: Restaurant analyst Peter Saleh says investors are salivating over the Dunkin’ Donuts IPO. The company’s revenue grew 7 percent last year. And it has big plans to expand west of the Mississippi.

OK, Saleh’s a little biased.

Peter Saleh: When I travel, I can’t get a Dunkin’, and it’s irritating.

Dunkin’ Donuts is one of a couple dozen companies owned by private equity to go public this year. Those companies account for 62 percent of IPO money raised. In contrast, venture capital-backed companies like LinkedIn and Pandora have gotten lots of attention for their public offerings. But they account for a much smaller share of IPO money raised.

Kathy Smith is with Renaissance Capital.

Kathy Smith: I think it could very well be that in July, not only does America run on Dunkin’ Donuts but the IPO market may run on Dunkin’ Donuts.

There is a catch, though. The company is nearly $2 billion in debt.

Smith: It’s not profitable after the interest on the debt.

Smith says Dunkin’ could pay down some of the debt with proceeds from the IPO. But shareholders would still have to stomach the rest.

I’m Jennifer Collins for Marketplace.

Marketplace is on a mission.

We believe Main Street matters as much as Wall Street, economic news is made relevant and real through human stories, and a touch of humor helps enliven topics you might typically find…well, dull.

Through the signature style that only Marketplace can deliver, we’re on a mission to raise the economic intelligence of the country—but we don’t do it alone. We count on listeners and readers like you to keep this public service free and accessible to all. Will you become a partner in our mission today?

Your donation is critical to the future of public service journalism. Support our work today – for as little as $5 – and help us keep making people smarter.