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Illustration: Aïda Amer/Axios

Rocket Companies, a Detroit-based mortgage lender operating under the Rocket Mortgage and Quicken Loans brands, raised $1.8 billion in an IPO that had been expected to raise upward of $3.3 billion.

Why it matters: This was a stunning flop, or at least so far as any $1.3 billion IPO can be deemed a flop. Not only because it came amidst a broad-based IPO surge, but also because it followed the IPO overperformance from insurance upstart Lemonade.

  • Rocket priced 100 million shares at $18, versus plans to sell 150 million shares at $20–$22.
  • It will list on the NYSE (RKT), used Goldman Sachs as lead underwriter, and is controlled by chairman Dan Gilbert.
  • The company reports $97 million of net income on $1.37 billion in revenue for Q1 2020.

The bottom line: "Rocket struggled to convince investors its mortgage platform business justified a valuation conferred to a technology company rather than a financial services firm." writes Reuters.

Go deeper

Dion Rabouin, author of Markets
Nov 4, 2020 - Economy & Business

Ant Group's IPO could be headed for more trouble

Data: Yahoo Finance; Chart: Axios Visuals

China's suspension of Ant Group’s $35 billion IPO is "just the beginning of a renewed campaign by China to rein in the fintech empire controlled by Jack Ma," Bloomberg reported Tuesday.

Details: "Authorities are now setting their sights on Ant’s biggest source of revenue: its credit platforms that funnel loans from banks and other financial institutions to millions of consumers across China," the article noted, citing unnamed sources.

Felix Salmon, author of Capital
Nov 4, 2020 - Economy & Business

When an Ant is too big to fail

Illustration: Sarah Grillo/Axios

Here's why Ant Group's IPO was pulled on Tuesday: It is one of the most systemically important financial institutions in the world, and at the moment it's barely regulated.

The big picture: Ant provides the technology that powers much of the Chinese economy, from borrowing to saving to investments to insurance. A failure of its systems could have devastating consequences for hundreds of millions of people.

34 mins ago - World

Putin foe Navalny to be detained for 30 days after returning to Moscow

Russian opposition leader Alexey Navalny. Photo: Oleg Nikishin/Epsilon/Getty Images

Russian opposition leader Alexey Navalny has been ordered to remain in pre-trial detention for 30 days, following his arrest upon returning to Russia on Sunday for the first time since a failed assassination attempt last year.

Why it matters: The detention of Navalny, an anti-corruption activist and the most prominent domestic critic of Russian President Vladimir Putin, has already set off a chorus of condemnations from leaders in Europe and the U.S.