Bluestem Brands Inc. postponed its initial public offering that was scheduled to begin trading today, citing market conditions.
The company, which targets low- to middle-income consumers for catalog sales as well as financing products, was aiming to raise $160 million on the Nasdaq under the symbol BSTM.
Based in Eden Prairie, Bluestem sells general merchandise ranging from housewares to apparel through its Fingerhut and Gettington.com brands. It helps its customers finance their purchases through agreements it has with MetaBank and WebBank.
Its target markets are low- to middle-income “credit constrained” consumers with subprime credit scores between 500 to 700. Bluestem must purchase its customers’ loan receivables from the banks in one to two business days, so it bears all the risk of non-payment or delayed payments.
The company’s net sales have been on the rise in recent years, growing 19 percent to $232 million in the 26 weeks that ended July 29, compared to the same period a year earlier. The company’s fiscal year ends Jan. 31.
Bluestem posed a net loss of $34.7 million in the 2011 period, compared to net income of $4.1 million a year earlier, primarily due to an increase in loss from derivatives as the value of the conversion on its own preferred stock and common stock warrants rose.
Minneapolis-based Piper Jaffray Cos. and San Francisco-based Wells Fargo & Co. were managing Bluestem’s IPO.
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via Fingerhut parent Bluestem Brands postpones IPO – TwinCities.com.