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Burger chain Habit Restaurants prices IPO at $18 a share

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[November 20, 2014]  (Reuters) - Habit Restaurants Inc, a fast-food restaurant chain known for its burgers, said its initial public offering was priced at $18 per share, valuing the company at about $454.5 million.

The company raised about $90 million from the IPO of 5 million Class A shares.

The offering was priced above the expected price range of $14 to $16.

The company, which operates the fast casual Habit Burger Grill chain of restaurants, offers charburgers, sandwiches and milk shakes.

The fast casual restaurant market consists of establishments where customers pay at the counter for food items that cost between $3-$12.

The fast casual segment generated sales of about $34.5 billion in 2013, representing an 11.3 percent increase from 2012, the company said in its filing, citing market research firm Technomic.

Founded in 1969 in California, the chain has 98 restaurants in four U.S. states. Its shareholders include private investment firm KarpReilly LLC.

The company reported a 43 percent increase in revenue to $120.4 million for the year ended Dec. 31. Net income nearly doubled to $5.8 million during the period.

The company joins the list of casual dining chains, including El Pollo Loco Holdings Inc and Zoe's Kitchen Inc, that have listed this year.

The IPO also comes ahead of an expected listing by Shake Shack, the fast-food restaurant chain that has developed a cult following for its "Shackburgers" and milkshakes.

Habit Restaurants plans to use the IPO proceeds to repay debt. The company had $13.6 million total debt as of Sept. 30.

Piper Jaffray, Baird and Wells Fargo Securities were the lead underwriters of the offering.

(Reporting by Amrutha Gayathri and Sai Sachin R in Bangalore. Editing by Andre Grenon)

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