Shares of retailer Roots Corp. had a less-than-stellar initial public offering, plummeting more than 16 per cent on the stock’s first day of trading.
The stock (TSX:ROOT) was priced at $12 per share at market open, but quickly fell to a low of $9.48 by early afternoon.
The shares were down 16.67 per cent, at $10.00 on the Toronto Stock Exchange at the close of markets Wednesday.
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For the heritage-fashion retailer, the switch from being a private company for more than four decades comes against a challenging retail environment that’s seen numerous bankruptcies, mass store closures and layoffs in recent years.
“We are in the early stages of leveraging our strategic operational investments to support our continued growth in Canada, the United States and internationally,” said Roots CEO Jim Gabel in a released statement.
“Our TSX listing provides an additional platform to help us unlock the potential of the Roots brand.”
The debut of Roots as a publicly-traded company follows recent initial public offerings by other Canadian fashion companies, including Aritzia Inc. (TSX:ATZ) and Canada Goose Holdings Inc. (TSX:GOOS).
Shares in Canada Goose have soared since they began trading earlier this year, however Aritzia shares have struggled and fallen well below their IPO price.
Roots is in the midst of planning a massive North American and international expansion over the next several years.
The company, known for its poor-boy style hats and woolly winter mitts that have adorned both Canada’s Olympic athletes and consumers, currently operates 120 stores in North America and has a partner running another 136 between Taiwan and China.
Roots is looking to open dozens of new locations. That includes up to 10 in Canada and up to 14 in the U.S. by the end of its 2019 financial year.
It’s also eyeing international markets, hoping to add up to 25 new locations in Taiwan and China, and build a presence in Singapore and Malaysia in the same time frame.
Beyond that, the company is evaluating partnerships in a dozen new markets abroad.
