NEW YORK (Reuters) -- Shares of Allison Transmission Holdings Inc. edged higher in their public debut today after the company sold more stock than expected in the initial public offering.
The IPO of Indianapolis-based Allison sold at $23, the midpoint of its range, raising $600.3 million on Wednesday. The company, which makes vehicle transmission systems, sold 26.1 million shares, while it had expected to sell 21.7 million.
Allison shares closed up 40 cents, at $23.40 on the New York Stock Exchange today.
Carlyle Group LP and Onex bought Allison Transmission from General Motors Co. for $5.6 billion in 2007. The private equity firms are selling all of the shares in the IPO, so Allison will not receive any proceeds.
"The opportunity for our financial sponsors who have given us great support in product development and helping us expand our global footprint to see some of the gains on this investment are well deserved," CEO Lawrence Dewey said in an interview.
In 2011, Allison's earnings topped $103 million, up from $30 million in the prior year. Net sales increased 12 percent to $2.2 billion.
"I was surprised to see them add 5 million more shares last night because that's usually only done when the deal is red-hot," said Scott Sweet, managing partner with IPO Boutique. "This deal was never red-hot."
Allison holds a 62 percent share of the global market for medium and heavy-duty commercial vehicles.