European firms take punt at low end of IPO ranges

By Kylie MacLellan

LONDON (Reuters) – Digital sports media firm Perform and aluminum group AMAG looked set to price their listings toward the lower end of original guidance as a new wave of European flotations heads for the market.

Success in achieving the share sales could be a boon to Swiss commodity trader Glencore (GLEN.UL: Quote, Profile, Research) as it moves closer to a much-anticipated potential $10 billion float, which is expected to be launched next week.

Companies are pressing ahead with initial public offerings (IPOs) after market volatility — which spiked last month on fears of a nuclear crisis in Japan and unrest in the Arab world — derailed several other planned floats.

But with a glut of firms competing for attention and the risk of uncertainty returning, buyers can afford to be discerning, bankers say, meaning companies wanting to get share sales done need a strong story and realistic price expectations.

“Investors are going to be very selective and they are going to scrutinize each asset on a case by case basis,” said one.

UK-based Perform Group, seeking to raise around 200 million pounds ($327 million) from a London float, is offering its shares at between 260 pence and 280p each, two sources close to the deal said, the lower end of its original 255p to 325p range.

Austria’s AMAG also cut the top of price guidance for its Vienna listing, worth up to 535 million euros ($764 million), sources with knowledge of the transaction said.

The firm, which had set a price range of 19 to 24 euros per share, is offering its shares at 19 euros to 21 euros each. One source with knowledge of the transaction said the number of existing shares on offer had also been reduced to around 14 million from 17 million.


Perform and AMAG, both due to close the order books on their listings on Wednesday, will set the scene for at least 13 companies looking to list by Easter.

British vacuum technology firm Edwards, Russian sugar and pork producer Rusagro and German engineering group Norma are also due to complete listings later this week.

A positive market debut by Polish financial adviser Open Finance (OPFP.WA: Quote, Profile, Research) on Tuesday is likely to have boosted confidence among issuers currently in the market.

Although a relatively small offering that raised $157 million, it was the first successful listing in Europe in several weeks and was trading more than 2 percent above its offer price on Wednesday.

AMAG’s IPO, set to be Austria’s biggest since construction group Strabag SE raised 1.33 billion euros in October 2007, will allow main owner CP Group 3 — a joint venture between One Equity Partners and Constantia Packaging — to reduce its stake.

The firm also plans to raise fresh money, through the sale of 5.3 million new shares, to expand its range of products and geographical reach.

Perform, which provides live streaming of sport videos and sports news and runs the websites of the Premier League and Chelsea Football Club, will sell 70 million pounds of new shares in its listing to fund both organic growth and acquisitions.

The firm’s management and employees collectively own 40 percent of the company. Access Industries, a privately held U.S.-based industrial group owned by billionaire Len Blavatnik, has a 58 percent stake.

Up to 131 million pounds of existing shares will be sold in the IPO, including an overallotment option, as both Access and management reduce their holdings pro rata.

Both Perform and AMAG declined to comment.

(Editing by David Holmes)

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European firms take punt at low end of IPO ranges