(Reuters) -Diesel engine maker Cummins Inc (NYSE:CMI) priced the initial public offering (IPO) of its engine filtration division to raise about $275 million, the company said on Thursday, defying volatile markets which are being shaken by uncertainty over a deal on the U.S. debt ceiling.
Atmus Filtration Technologies sold 14.1 million shares at $19.5 a piece, the company said in a press release. The company had previously guided the IPO could be priced at between $18 and $21 per share.
The IPO values Atmus at $1.6 billion. The stock is scheduled to start trading on Friday on the New York Stock Exchange under the symbol “ATMU”.
Financial markets have been on edge over the timing of a deal between the White House and Republicans in Congress to raise the debt ceiling ahead of the June 1 deadline set by the U.S. Treasury.
Despite the elevated volatility, however, the Cboe Volatility Index, known as Wall Street’s “fear gauge,” remains below 20, the level many bankers say makes it difficult to price IPOs.
The VIX has been above 20 most of the time since the first quarter of 2022 as the war in Ukraine and interest rate hikes by central banks fueled market jitters. This created an IPO drought, with only a few stock market hopefuls bucking the trend.
Companies have raised about $2.2 billion in the first quarter this year, compared to more than $42.6 billion during the same period in 2021, according to Dealogic.
The Atmus IPO follows in the steps of Johnson & Johnson (NYSE:JNJ)’s consumer health business Kenvue Inc, which raised $3.8 billion earlier this month in the largest IPO of this year.
Atmus provides filtration products for trucks, off-highway industrial equipment and power generation systems.
Columbus, Indiana-based Cummins will control about 83% of the company’s shares after the listing on the New York Stock Exchange.
Goldman Sachs & Co (NYSE:GS)., and JPMorgan Chase & Co. (NYSE:JPM), are the lead underwriters for the IPO.