This morning Hayward Holdings began trading on the New York Stock Exchange. The company announced its intention to be listed Feb. 17 and CEO Kevin Holleran rang the closing bell this afternoon.
“This is like a dream come true to be able to lead a great company that’s been doing what we’ve been doing for 95 years through this next chapter,” Holleran says. “It’s really exciting.”
Hayward intends to sell 40,277,778 shares of its common stock at $17 per share. Under the ticker symbol HAYW, on its first day it traded between $16.62 and $17.75 a share.
“This is a tribute to 95 years of building this great brand, the most known and trusted brand in the pool industry,” Holleran says. “It’s just spectacular for our present and past employees.”
Holleran joined Hayward in August 2019 and says it was always his aspiration to take the company public. “To be able to access the public markets, be able to de-lever some of our debt, give us some financial flexibility and optionality to start funding some go-forward growth initiatives, this is what I hoped would materialize and feel fortunate that we were able to get to today,” he says.
In its regulatory filings, Hayward says it intends to use the estimated more than $700 million gross proceeds to pay down some $300 million in debt.
One of the few companies in the swimming pool industry to be publicly traded, Hayward will be the only swimming pool equipment-only manufacturer to be represented on the NYSE. While both Pentair (NYSE) and Fluidra (BME) are traded, swimming pools is only a part of Pentair’s overall portfolio and Fluidra is traded in Spain.
“We are very much of a pure play,” Holleran says. “Ninety-six percent of our revenue is tied to residential and pool, where they’re more diversified than we are. Our heavy concentration in North America is very different, we view that as beneficial. The U.S. has strong margins, best pricing of anywhere around the globe, so it’s an advantage to be indexed the way we are.”
Holleran believes the coronavirus pandemic amplified the existing trends and growth of the pool market.
“It’s brought more attention to some underlining trends that had existed previous,” he says. “Our belief is that those secular trends driving it are going to continue. I think people are going to continue to deurbanize, continue to migrate to those parts of the country and when there, the weather is so nice, they want outdoor amenities, they want outdoor lifestyle. The pool is really the centerpiece of it. We feel very confident that these trends are going to continue and that there’ll be some strong growth and for our company and for our broader industry to come.”
The IPO comes only a week and a half after the death of the company’s former owner and chairman Oscar Davis. The Davis family owned Hayward from 1964 until 2017 when it was sold to a private equity firm. Holleran says Davis knew the company planned to go public. “I think he would’ve been proud to see what came of the company that he guided for so long and put it on its current path,” Holleran says. “It’s incredibly unfortunate timing. I think he might still be looking down on us and seeing it.”
The IPO closes March 16, but Holleran says that will be too early to judge its success. “We know this is going to be a successful offering,” he says. “This is all about really trying to continue to grow topline, welcome some new shareholders into the company and into the stock. And continue on with our interests to expand product lines and look at some inorganic growth opportunities — that’s ultimately what’s going to define the success of this organization.”
Holleran says the company doesn’t take for granted the thousands of Hayward dealers who helped get them to this point.
“To have them placing their confidence in us and our brand every day installing equipment in the backyard, we’re honored to have those thousands advocating on our behalf,” Holleran says. “Today is a day they’re sharing in our excitement.”
