Duck Creek Technologies shares jumped in their trading debut on the Nasdaq after the provider of software to the property-casualty-insurance industry priced its initial public offering above its estimated range.
The Boston company priced 15 million shares at $27, raising $405 million. The IPO had been estimated to range $19 to $21 a share, which later was raised to $23 to $25 a share.
The opening trade was $42 a share. At last check the stock, trading on Nasdaq under the symbol DCT, was 48% higher at $40.
The company is valued at about $3.5 billion following its debut.
Duck Creek plans to use $37.8 million of the net proceeds to pay Accenture (ACN) - Get Report for its stake in a Cayman operating partnership; $56.7 million will go to buy back part of the common stock that the London private-equity firm Apax Partners owns, and $5.5 million will go to settle equity awards outstanding for certain international stakeholders, the company's S-1 prospectus filed with the SEC said.
Goldman Sachs, JPMorgan and Bank of America are the leading bookrunners for the offering, with Barclays and RBC assisting.
The company says it is one of the first companies to provide carriers with an end-to-end suite of software solutions for the insurance industry.
The insurance industry deals with a lot of data, but relies mostly on legacy technology to process claims, Duck Creek says. This gives the company room to grow.