Kitchener e-learning company D2L seeks to raise $ 200 million with IPO

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KITCHENER – E-learning company D2L Inc. is looking to raise $ 200 million as it prepares to go public.

An updated prospectus submitted to securities regulators this week outlines financial details of the Kitchener company’s proposed initial public offering and its debut on the Toronto Stock Exchange.

D2L plans to offer 9,523,810 to 10,526,316 shares between $ 19 and $ 21 each, for gross proceeds of approximately $ 200 million. Almost $ 57 million is intended to cover income tax payments related to shares distributed by an existing employee trust and to repay a business loan.

A launch date has not been set, pending regulatory approval, and the underwriters will have an over-allotment option to sell additional shares worth up to $ 30 million within 30 days of closing.

Formerly Desire2Learn, the company would be the second Waterloo region company to go public this year after Magnet Forensics launched on the Toronto Stock Exchange in April.

The prospectus also confirmed that D2L will move from its 132,000 square foot office in the Tannery building next summer to a 93,000 square foot space controlled by owner Catalyst 137 Kitchener LP, having signed an 11-year lease the last week.

Catalyst 137 is the Glasgow Street technology hub originally built as a tire warehouse.

D2L founder – now president and CEO – John Baker will own about 51.6% of the company if the shares are priced at $ 20 and the over-allotment option is not exercised. However, he will own more than 90 percent of the voting rights, given his ownership or exclusive control of the multiple voting shares of D2L.

“As a result, John Baker will have a significant influence on the company,” notes the prospectus.

Baker founded the firm in 1999 while still a student at the University of Waterloo. More than 15 million people around the world use D2L products, including the flagship cloud-based software platform Brightspace.


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