Foundation priced its initial public offering of 23.61 million shares at $22 a share, above the range of $19 to $20 being considered earlier. The stock closed at $21.75 on volume of more than 16 million shares.
Foundation's primary stockholders, Blackstone Group and First Reserve Corp along with coal producer American Metals & Coal International (AMCI) bought Foundation from German company RAG in August.
The IPO values Foundation at roughly $976 million. Blackstone and First Reserve each now own about 16% of Foundation, and AMCI owns about 6%.
Together with their dividend and the market value of their Foundation stock, the three investors made a profit of $560 million on a $200 million investment.
Proceeds left after the three investors are paid will be used to reduce debt and for general corporate purposes.
In related news another company owned by Blackstone and First Reserve filed an initial public offering to sell up to $250 million in common stock.
Alpha Natural Resources produces about 25 million tons of coal annually from 44 underground mines, 20 surface mines and 11 preparation plants located throughout Virginia, West Virginia, Kentucky, Pennsylvania and Colorado.
The company holds more than 500 million tons of proven and probable coal reserves.
Alpha Natural's operations are primarily made up of mines acquired in 2002 and 2003 from Pittston Coal and Coastal Coal.
The offer is being underwritten by Morgan Stanley, Citigroup and UBS Investment Bank were. The company intends to list its common stock on the New York Stock Exchange under the symbol ANR.
