With Sales Thriving, Vitamin Shoppe Parent Files for IPO

Six months after pulling its previous initial public offering (IPO) filing, the parent company of Vitamin Shoppe, VS Holdings, has once again filed for an IPO, this one to raise as much as $143.8 million on the New York Stock Exchange. 


The number of shares offered and expected opening date and price for the IPO were not specified in the prospectus filed with the Securities and Exchange Commission (SEC) by VS Holdings on July 24. Vitamin Shoppe operates a chain of 425 vitamin retail stores throughout the United States, but the company says the market could support up to 900 stores.

As Vitamin Shoppe CEO Tom Tolworthy told attendees of the 2009 NBJ Summit on the day of his company’s filing, the supplement specialty retailer is thriving in the current recession, which is driving consumers to become more focused on self-care and sickness prevention. “Instead of massive obstacles, the economy is offering up a huge platter of opportunity,” Tolworthy said, noting that Vitamin Shoppe recently experienced its 14th consecutive quarter of comp store sales growth and has seen a 20% rise in new customers. The chain said net sales grew at an annual rate of 11.3 percent between 2005 and 2008, during which time it opened 171 new stores, to reach $601.5 million.

Private-equity firm Irving Place Capital Management LP (previously known as Bear Stearns Merchant Banking) currently owns about 80% of VS Holdings, which plans to be renamed Vitamin Shoppe. The company plans to use its IPO money to pay down debt.

New IPOs came to a near standstill last year—which saw a total of four public offerings—but the market is beginning to show “signs of life,” David Thibodeau, managing director of Canaccord Adams, told NBJ Summit attendees. “Public offerings by companies with strong financials will get done in 2009,” he said.

Vitamin Shoppe’s IPO would be the first for a retailer in nearly two years. The company filed a similar prospectus with the SEC in 2007.

Related NBJ links:
Supplement Retail Sales See Boost from Consumers Looking to Avoid Costly Doctor Visits and Rx Drugs
Reality Dose: Vitamin Chain Stores Report Strong Growth
Retail Versus E-Tail: Vitamin Shoppe CEO Shares Views On Both Venues

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