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PE Firms Get Cold Feet

I know it’s brisk outside, but there’s got to be some other reason for the recent spate of canceled PE-backed IPOs. Last Friday it was Tube City IMS, and today’s it’s Hyco International and Trident Resources Corp.

No official explanations were given in any of the withdrawal filings, save for Trident’s lame notation about “market conditions.” Shouldn’t the SEC deny Trident’s request, with a short retort that market conditions are actually quite lovely?

For context, there were only two such withdrawals in all of January, and one of them was for a company (St. Francis Medical) that was being acquired. For the past twelve months, the average figure was less than five per month – and that includes both to-be-acquired companies and those that never raised private equity.

Maybe it’s just an aberration, but there is that saying about two being a coincidence and three being a trend. None of the three companies share a common industry nor do they share common underwriters (save for Credit Suisse being one of many for both Trident and Tube City). So definitely something worth watching… Here’s the rundown:

* Hyco International Inc., an Atlanta, Ga.-based maker of custom-designed hydraulic cylinders for use in mobile equipment, has canceled a proposed $100 million IPO. No reason was given. The company had planned to trade on the Nasdaq, with Friedman Billings Ramsey and Harris Nesbitt serving as co-lead underwriters. Centre Partners holds a 96.5% position.

* Trident Resources Corp., a Calgary-based natural gas exploration and development company, has canceled a proposed $300 million IPO, citing market conditions. Credit Suisse, Morgan Stanley and TD Securities had been serving as co-lead underwriters. Shareholders include Aurora Energy Partners, Clery Sarl and RFG Private Equity.

* Tube City IMS Corp., a Glassport, Pa.-based provider of outsourced services to steel mills, has canceled a proposed $172.5 million IPO. Wellspring Capital Partners holds an 84% position. It had been planning to trade on the Nasdaq, with Credit Suisse, UBS and Jefferies & Co. serving as co-lead underwriters.