Krispy Kreme’s second stint on the stock market was off to a rocky start Thursday, but bounced back in a big way. 

The doughnut chain announced an initial public offering of 29,411,765 shares at $17 per share, raising $500 million. That equates to a value of $2.7 billion. That’s far below its projected range of $21 to $24 per share, and the raising of between $560 million and $640 million. That range implied a valuation of $3.46 billion to $3.96 billion. 

But Krispy Kreme’s fortunes improved throughout the day. The stock opened at $16.30 per share, but rose more than 23 percent to $21 per share at closing on Thursday. The company trades on the Nasdaq Global Select Market under the symbol “DNUT.” Underwriters have been granted a 30-day option to purchase up to an additional 4,411,764 shares of Krispy Kreme’s common stock at the initial public offering price.

“The transformation that this company has done in the last five years has been incredible,” Krispy Kreme CEO Mike Tattersfield told CNBC’s “Squawk Box.” “We’ve worked on our brand, we’ve worked on the culture.”

The company will use net proceeds from the offering to repay debt, repurchase shares of common stock from certain executives, make payments on tax withholdings relating to certain restricted stock, and for general corporate purposes.

Krispy Kreme was public from 2000 to 2016, but was taken private by JAB Holding for $1.35 billion. JAB also acquired Panera for $7.5 billion in 2017 and purchased British chain Pret a Manger for $2 billion in 2018. The 84-year-old brand first announced its intentions to return to the stock market in early May.

The chain earned net revenue of $1.1 billion in 2020—the highest sales level in history—and swung a net loss of $64.3 million, compared to $959.4 million in net revenue and a net loss of $37.4 million in 2019. In its most recent quarter, the company earned $321.8 million in net revenue compared to $261 million last year, and a net loss of $3 million compared to $11 million in the year-ago period.  As of April 4, Krispy Kreme has 1,515 stores and 7,371 Delivered Fresh Daily locations across the globe.

The doughnut brand also owns 191 Insomnia Cookies stores in the U.S. Krispy Kreme describes Insomnia as a digital-first brand, with 54 percent of sales coming through online channels in 2020. Seventeen stores opened in 2020 and another 30 are under construction for this year. The plan is to grow its capabilities to deliver next-day to more than 95 percent addresses in the U.S.

J.P. Morgan, Morgan Stanley, BofA Securities, and Citigroup are acting as lead book-running managers for the proposed offering. BNP PARIBAS, Deutsche Bank Securities, Evercore ISI, Goldman Sachs & Co. LLC, HSBC, Truist Securities, and Wells Fargo Securities are acting as joint book-running managers.

Capital One Securities, C.L. King & Associates, Credit Agricole CIB, Mischler Financial Group, Inc., MUFG, Ramirez & Co., Inc., Santander Investment Securities Inc., and Siebert Williams Shank, are acting as co-managers.

Finance, Story, Krispy Kreme