Finance

Jessica Alba-backed Honest Company IPO raises $412.8 million By Reuters

© Reuters. FILE PHOTO: Actress and founder of the Honest Company Jessica Alba poses as she arrives for the 20th Annual Webby Awards in Manhattan, New York, U.S., May 16, 2016. REUTERS/Mike Segar

By Echo Wang

(Reuters) -Honest Company Inc, the consumer goods company founded by actress Jessica Alba, said it priced its initial public offering (IPO) on Tuesday slightly above the midpoint of its indicated range, raising $412.8 million.

The company said late Tuesday that it sold 25.8 million shares at $16 each. Honest had previously indicated shares could be sold in the IPO at $14-$17 apiece.

The IPO values Honest at $1.44 billion.

Honest, which counts the likes of Lightspeed, Fidelity and General Catalyst among its backers, sells products including diapers, nursing pillows, vitamins and non-toxic household products. These are sold on Honest.com and through partnerships with brick-and-mortar stores including Costco (NASDAQ:) and Target (NYSE:).

Alba, known for her roles in film “Fantastic Four” and TV series “Dark Angel”, in 2011 co-founded Honest, which touts its baby products as a safer alternative to those that use synthetic chemicals, and remains a shareholder.

But the company came under scrutiny in 2016, when a lawsuit said its products contained a harsh chemical it had pledged to avoid.

Honest then reached a $7.35 million settlement for wrongly labeling ingredients in some products as natural, plant-based or chemical free.

The Los Angeles-based company plans to list its shares on the Nasdaq under the symbol “HNST” on Wednesday.

Honest is offering 6.5 million shares of common stock. Stockholders named in the prospectus are offering 19.4 million shares of common stock.

Morgan Stanley (NYSE:), Jefferies (NYSE:) and J.P. Morgan are among the lead underwriters for the offering.

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