Public Offering Made By Purple Innovation

Lehi, Utah-based company Purple Innovation, Inc. completed a public offering in March. Bank of America underwrote the public offering by buying 14 million shares of Purple Innovation’s Class A Common Stock and then reselling the securities through its distribution network. The transaction also gave Bank of America a 30-day option to buy 2.1 million additional shares. Several investors with already significant holdings took advantage of the public offering and increased their stake in Purple Innovation: Coliseum Capital Management LLC, Wasatch Advisors Inc., and Van Berkom & Associates.

Before the public offering in February 2022, Purple Innovation renegotiated its debt payments. The renegotiated agreement allowed Purple Innovation to retain up to $25 million in cash on hand after the public offering. Anything beyond $25 million must be used to satisfy the outstanding revolving loans it owes.

Purple Innovation primarily sells sleep products. These products include mattresses, pillows, cushions, bed frames, sheets, and other product lines. The company sells through online channels, traditional retail establishments, third-party online retailers, and its own showrooms. With Purple Innovation’s focus on home comfort products, it saw significant demand in 2021, but like other companies, experienced supply chain challenges. These challenges were further exacerbated with an industrial accident that killed an employee in May 2021 and caused significant delays in its manufacturing.

Purple Innovation has just under 83 million shares outstanding. Analysts expect Purple Innovation to announce earnings per share at $0.31 for the most recent quarter.

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