Karat Packaging Announces Secondary Offering

By Tamara Parker • Thursday, June 12 10:11 • Permanent Link

Karat Packaging Inc. (NASDAQ: KRT) has announced the commencement of a proposed secondary offering of 1,500,000 shares of its common stock by certain members of the company’s management team. The selling stockholders will also grant the underwriter a 30-day option to purchase up to an additional 225,000 shares of Karat’s common stock offered in the offering.

Karat is not offering any shares of its common stock in this offering and will not receive any proceeds from the sale of shares by the selling stockholders.

BofA Securities and William Blair & Company, L.L.C. are acting as the joint lead book-runners for the offering.

The offering of these securities is being made pursuant to a shelf registration statement on Form S-3 (file no. 333-286011), which was filed with the U.S. Securities and Exchange Commission (SEC) on March 21, 2025, and declared effective on March 28, 2025.

The company, which is a specialty distributor and manufacturer of disposable foodservice products and related items, primarily used by national and regional restaurants and in foodservice settings throughout the United States, has products including food and take-out containers, bags, tableware, cups, lids, cutlery, straws, specialty beverage ingredients, equipment, gloves, and other products. Its eco-friendly Karat Earth® line offers quality, sustainably-focused products that are made from renewable resources. Karat Packaging also offers customized solutions, including new product development and design, printing, and logistics services.

In terms of the financials, the company’s revenue for the last financial period was $342 million, up 12% from the same period last year. Net income for the same period was $18 million, representing a 15% increase from the previous year. Additionally, the company’s EBITDA margin was 9%, showing a slight improvement from the last period.

Investors and market analysts will be closely watching the progress of this secondary offering and how the company utilizes the proceeds from the stock sale. Today the company's shares have moved -14.73% to a price of $26.40. If you want to know more, read the company's complete 8-K report here.

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