IPO an Inner City 100 First
Molina Healthcare, a managed care provider based in Long Beach, Calif., became the first company from Inc.'s Inner City 100 list to go public. The price of the stock rose from $17.50 to $20.30 on July 2, its first day of trading, and was hovering above $24 at presstime. The deal was underwritten by Banc of America Securities. CEO Mario Molina used the $115.5 million raised to pay off debt, and he's now considering acquisitions and expanding into new states. His company, which appeared on the list three years in a row starting in 2001, is among the largest to have appeared on the Inner City 100, with $644 million in revenue last year. It specializes in serving African American, Hispanic, and Southeast Asian clients in 22 urban markets. The offering of 6.6 million shares was part of a broader rebound in the IPO market. Molina was the fourth offering in a two-week period; there were just five IPOs in the entire second quarter. "We hit the market at a good time," says Molina. "We had a long track record, and we were profitable. We were an attractive investment."
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