Quicken Loans is looking to raise as much as $3.8 billion from its initial public offering.
The Detroit-based mortgage giant, which is rebranding itself as Rocket Companies, disclosed Tuesday in an SEC filing that it is proposing a $22-per-share maximum offering price and selling 172,500,000 shares.
The company has yet to announce a date for the IPO.
Founder and Chairman Dan Gilbert would maintain significant control of the company following the IPO through his holding company, Rock Holdings, which would have 79% of the combined voting power of Rocket Companies' common stock.
The company anticipates its likely net proceeds from the IPO as about $3.1 billion, based on a $21 per-share price, which would be the midpoint of the $20 to $22 offering price range.
The Rocket Companies IPO would be one of the biggest of 2020, and it is expected to receive a favorable response on Wall Street this summer.
"Unlike most IPOs, the company is profitable, and has earned high return on equity," said Jay R. Ritter, an IPO expert and Cordell Eminent Scholar at the University of Florida's Warrington College of Business.
Ritter expects the IPO to trade in early August.
While Rocket is growing, the revenue is also variable from year-to-year so that can create some uncertainty for investors.
"As with other mortgage lenders, when interest rates drop, many homeowners refinance, and thus the number of new mortgages (including refinancing) tends to fluctuate a lot from year-to-year," Ritter said.
Not all IPOs are sure-bets for investors.
Some tech stocks, for example, that have been disappointments for investors in the year after the IPO include Lyft and Blue Apron, according to Ritter.
"Neither were profitable at the time of the IPO, however, and they have continued to struggle with profitability," Ritter said.
Along with Quicken Loans, other businesses under the Rocket Companies umbrella would include title company Amrock, home search platform Rocket Homes, personal loans provider Rocket Loans, call center Rock Connections and a used car business called Rocket Auto that is relatively new.
