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Amadeus Prices €1.3 Billion IPO

LONDON (Reuters) – Travel reservations group Amadeus wrapped up its 1.3 billion euros ($1.7 billion) initial public offering (IPO) in Madrid, ending a two-year drought in Spanish listings.

The final price of 11 euros for the listing was slightly above the middle of a price range of 9.2 euros to 12.2 euros which the company had initially set. It received orders for more than four times the amount of shares offered.

The success of the deal, Europe’s largest IPO this year, defies a fickle market for new stock market issues, exemplified by the recent failure of a $1.8 billion attempted London listing by Amadeus’s rival Travelport.

It will also ease fears that investors are wary of buying private equity-backed assets that had risen after Travelport scrapped its listing in February.

Amadeus’s IPO comprised the sale of 36.9 million shares by private equity groups BC Partners [BCPRT.UL] and Cinven [CINV.UL], as well as airlines Air France (AIRF.PA) and Lufthansa (LHAG.DE).

The deal leaves the private equity groups with a combined shareholding of 34.6 percent, down from more than 50 percent. The bookrunners for the share sale were Goldman Sachs, JP Morgan and Morgan Stanley.

The company is also issuing 82.7 million new shares, raising around 909 million euros which it will use to reduce debt.

One banking source said the offer was fully covered at the low end of the original range within three days of the deal’s launch, as investors sought to buy into a cyclical recovery in the travel industry.

The price range was then tightened twice during the bookbuild, first to between 10.5 and 11.25 euros, and again late on Monday to between 10.7 and 11.0 euros.

High quality investment funds predominantly from Britain, France and the United States dominated the book, the source said, and the deal could have priced higher but lead managers opted to leave some room for when shares begin trading on Thursday.

The book closed just before Standard & Poor’s cut Greece’s debt ratings to junk status, sending global equity markets sharply lower, particularly in southern Europe.  

Spain’s IBEX 35 index .IBEX was one of the hardest hit European markets on Tuesday, falling 4.1 percent, casting a cloud over the debut. 

By Chris Vellacott (Editing by Hans Peters and David Holmes) ($1=.7508 Euro)