Sections

ideals
Business Essentials for Professionals

Possible 4 Billion Euros IPO This Year For French Bottle Maker Verallia: Reuters


04/09/2019


Possible 4 Billion Euros IPO This Year For French Bottle Maker Verallia: Reuters
According to a report published by the news agency Reuters, the  French glass bottle maker Verallia is being prepared for a stock market listing later this year by buyout group Apollo. The report also stated that this would possibly be the largest French initial public offerings of the year.
 
The news report quoting sources with knowledge of the matter claimed that the private equity firm has asked banks to show interest in the coming days for taking up roles in organizing the floatation. The IPO could place a value of more than 4 billion euros ($4.5 billion) for Verallia, the sources reportedly said. Buyout is also reportedly working together with Lazard as its IPO adviser. The sources also added that Verallia is being advised by Rothschild as well.
 
The major clients of the French company include names such as Pernod Ricard, champagne house Dom Perignon and chocolate spreads maker Nutella. The foundation of Verallia dates back to the Vauxrot glassworks which was set up in 1827.
 
For the IPO of Saint-Gobain’s former glass bottle unit, in which Apollo bought a controlling stake in 2015, the so-called global coordinators are expected to be mandated later this month or in May. Sources also said that the listing may happen in September or later.
 
There were no comments available with Reuters form Apollo and Lazard. Rothschild declined to comment.
 
There have been few IPOs in France in recent times and the wobbly market conditions have forced the cancellation of some deal such as that of the logistics firm Gefco. Hong Kong was chosen for listing its IPO by tourism group Club Med’s parent.
 
According to media reports, a stake in the state-owned lottery firm Francaise des Jeux could be out up for the public through an IPO under a new law that was  published last year, is among the very few of the possible listings of large French companies possibly seeking ot go public this year.
 
In the first quarter of the current year, the number of companies issuing initial public offerings touched a new low which was the lowest since the aftermath of the 2008 financial crisis. This was because companies did not want to take any chance because of the uncertainty surrounding Brexit and the trade war between the United States and China.
 
Markets are expecting Verallia to report core earnings (EBITDA) of about 550 million euros for the current year and the sources said that the company has the chance of being valued at between 7 and 8 times of that amount in a potential IPO.
 
Rivals such as Vetropack, Owens-Illinois or Vidrala trade in a wide range of 2.7 to 9.4 times EBITDA.
 
Verallia was valued 2.95 billion euros when Apollo bought the majority the company in a 2015 deal. Last year, 16 billion glass bottles and jars were made by Verallia and is the major most important supplier of bottles to the champagne and cognac industries of France.
 
(Source:www.reuters.com)