Benefitfocus files for initial public offering

Tyler Ann Soniak, manager of solution engineering, shows a demo at Benefitfocus in Charleston. (Photo/Leslie Burden)
Tyler Ann Soniak, manager of solution engineering, shows a demo at Benefitfocus in Charleston. (Photo/Leslie Burden)

By Liz Segrist
lsegrist@scbiznews.com
Published Aug. 15, 2013

Benefitfocus Inc. is preparing to go public with its recent filing of a proposed initial public offering of shares of its common stock.

The Daniel Island-based tech firm plans to raise up to $75 million, according to its filing with the Securities and Exchange Commission. The company filed a registration statement with the SEC on Wednesday, which has not yet become effective.

CEO Shawn Jenkins
Benefitfocus CEO Shawn Jenkins
“The principal purposes of this offering are to increase our financial flexibility, increase our visibility in the marketplace, and create a public market for our common stock,” according to the filing.

Benefitfocus builds online platforms used by companies and insurance carriers to manage benefits. The company has offices in Greenville, San Francisco and Tulsa, Okla., as well as Charleston.

The company expects to use the offering’s net proceeds for “working capital purposes and other general corporate purposes, including executing our growth strategy, developing new products and services, and funding additional capital expenditures, potential acquisitions, and investments.”

Industry experts have been anticipating Benefitfocus’ IPO filing. Benefitfocus plans to apply to list its common stock on the Nasdaq stock market under the ticker symbol “BNFT.”

Neither the number of shares to be sold by Benefitfocus and its selling shareholders, nor the price range for the proposed offering, has been determined.

“Benefitfocus will not receive any of the proceeds from the sale of the shares being sold by the selling stockholders,” according to the filing.

Goldman, Sachs & Co., Deutsche Bank Securities Inc. and Jefferies LLC will act as the book-running managers for the offering. Canaccord Genuity Inc., Piper Jaffray & Co. and Raymond James & Associates Inc. will act as co-managers, according to the filing.

The company has had three years of net losses, with $2.4 million in 2010, $14.9 million in 2011 and $14.7 million in 2012.

“We cannot predict if we will achieve sustained profitability in the near future or at all. We expect to make significant future expenditures to develop and expand our business,” the filing said.

In May, CEO Shawn Jenkins announced plans to expand internationally over the next year with plans to target the Canadian market first. The company also opened an 80,000-square-foot design and engineering facility on Daniel Island last year.

Founded in 2000, Benefitfocus employs more than 700 people. Its cloud-based services help manage health care and other benefits for employers, insurance carriers and consumers.

In 2006, the company had 2.5 million consumers using its platforms. As of last year, 20 million consumers signed up, such as Continental Tire, Dannon and UnderArmour.

Reach Liz Segrist at 843-849-3119.

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