Jessica Alba's Honest Company raises US$412.8m in stock sale

Business | 5 May 2021 8:59 am

Honest Company Inc, the consumer goods company founded by actress Jessica Alba, priced its initial public offering (IPO) on Tuesday slightly above the midpoint of its indicated range, raising US$412.8 million, a person familiar with the matter said, Reuters reports.

Honest sold 25.8 million shares at US$16 each, the source said, requesting anonymity ahead of an official announcement.

The company had previously indicated shares could be sold in the IPO at US$14-US$17 apiece.

The IPO values Honest at US$1.44 billion.

Honest did not immediately respond to a request for comment.

Honest, which counts the likes of Lightspeed, Fidelity and General Catalyst among its backers, sells products including diapers, nursing pillows, vitamins and non-toxic household products. These are sold on and through partnerships with brick and mortar stores including Costco and Target.

Alba, known for her roles in film Fantastic Four and TV series Dark Angel, in 2011 co-founded Honest, which touts its baby products as a safer alternative to those that use synthetic chemicals, and remains a shareholder.

But the company came under scrutiny in 2016, when a lawsuit said its products contained a harsh chemical it had pledged to avoid.

Honest then reached a US$7.35 million settlement for wrongly labeling ingredients in some products as natural, plant-based or chemical free.

The Los Angeles-based company plans to list its shares on the Nasdaq under the symbol HNST on Wednesday. Morgan Stanley, Jefferies and J.P. Morgan are among the lead underwriters for the offering.

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