Wall Street Buyers Take Quickly to Wheelabrator

The initial public stock offering of Wheelabrator Technologies Inc., a unit of La Jolla-based Henley Group Inc., opened Thursday to a highly enthusiastic reception on Wall Street. Henley also announced plans to buy back up to 20 million of its 98 million common shares outstanding.

The 6-million-share offering was initially priced at $19 per share, raising $114 million in gross proceeds. Subtracting underwriting commissions, WTI stands to net $107.4 million from the offering. WTI is a Hampton, N.H.-based trash-to-energy plant developer and operator.

Demand for the WTI shares was so high that the first over-the-counter trade Wednesday crossed at $22.25 per share. WTI stock closed the day at $23 per share, up $4 from the offering price, on volume of 5.6 million shares. The volume was described by brokers as unusually high, given that only 4.8 million shares of the offering were sold domestically.

Buoyed by the Wheelabrator offering and the stock repurchase announcement, shares of Henley Group closed up $.875 per share Wednesday at $30.375. Henley now owns 82% of the 34.5 million WTI shares outstanding.

Henley said it would buy back its shares on the open market and in negotiated transactions “from time to time . . . depending on market conditions and other factors.”

A WTI spokesman said chances are good that an additional 900,000 WTI shares in the underwriters’ overallotment will be sold this week, raising an additional $16 million for WTI. All the shares sold in the offering are new shares issued by WTI.

WTI will use the proceeds for general corporate purposes, including possible acquisitions, a spokesman said.

On a pro forma basis, WTI reported net income of $12.2 million on revenues of $500 million for the six months ended June 30. For the full year, WTI posted net income of $4.8 million on revenue of $849 million.