Reuters – Belgian diaper maker Ontex plans to raise up to 620 million euros ($844 million) in one of Europe’s biggest new listings this year to cut its debt and bring in cash for its private equity owners.
Ontex said the listing on Euronext’s Brussels stock exchange should give it an enterprisevalue of between 1.74 billion and 1.94 billion euros. Private equity firm TPG and Goldman Sachs acquired the company in 2010 for a reported enterprise value of 1.2 billion euros.
Ontex, which is a leading provider of baby diapers and also makes wet wipes and products for adults, has 5,000 staff and is headquartered in Erembodegem, Belgium. It has 15 production facilities across Europe, Asia and Africa.
The company had adjusted core earnings (EBITDA) of 173.6 million euros last year. An enterprise value of 1.94 billion euros would give the firm a valuation of 11.2 times earnings.
Some 53 percent of its revenue comes from babycare products, one third is from adult incontinence products and 13 percent comes from sanitary and other feminine care products. Its customers include retailers Carrefour, Tesco, Aldi, Lidl and Auchan and half of its revenues come from Italy, Germany, France and Britain.
Ontex said it should raise between 583 million and 620 million euros from selling up to 20 million new shares and from the sale of 7 million shares by Whitehaven B, an investment vehicle controlled by TPG and funds affiliated with Goldman and previous and existing management.
Whitehaven B would continue to hold at least 45.8 percent of the company.
The shares are expected to list on or before June 25 and will be sold at between 16.5 and 20.5 euros apiece.
Ontex said it expected to raise a net 278 million euros, which would be used to cut its debt. The business had net debt of 862 million euros as of March 31.
Under Belgian regulations, at least 10 percent of the offer shares must be allocated to retail investors in the country, subject to sufficient demand.
Depending on the demand, Ontex said it had an option to increase the number of shares sold by 15 percent, bringing the stake sold on the market to 48.1 percent.
The listing is being led by Bank of America Merrill Lynch , Goldman Sachs and UBS. JP Morgan is a bookrunner. ($1 = 0.7345 Euros) (Reporting by Robert-Jan Bartunek, Steve Slater and Freya Berry; editing by Miral Fahmy and Tom Pfeiffer)