UPDATE 3-Dunkin' Brands IPO values co as much as $2.3 bln

Mon Jul 11, 2011 9:54am EDT

* Sees IPO of 22.3 mln shares at $16-$18/shr

* Key stockholders Bain Capital, Caryle, THL not selling shares in IPO

* IPO to get better-than-anticipated reaction from investors - analyst (Rewrites throughout, adds analysts comments, details, background)

By Brenton Cordeiro and Tanya Agrawal

BANGALORE, July 11 (Reuters) - Dunkin' Brands Group Inc, known for its Dunkin' Donuts and Baskin Robbins ice cream, has set a price range for its public offering, valuing the company at as much as $2.3 billion, at a time when IPOs have had mixed reception from investors.

The company, taken private in a $2.4 billion deal in 2005 by a consortium including Bain Capital, Carlyle Group and Thomas H. Lee Partners, said it was offering about 22.3 million shares at a price band of $16-$18 apiece.

"Dunkin' Brands has been transformed quite dramatically into something new relative to the takeover. There are some very smart people directing the company," said David Menlow, president of IPOfinancial.com. "I think it (the IPO) will get a better-than-anticipated reaction from investors."

While most tech offerings, including those from LinkedIn Corp and Yandex , had strong trading debuts, companies like Vanguard Health Systems priced its IPO below its filed range, and Stewart & Stevenson LLC postponed its market debut.

The initial public offering of Toys R US , the world's largest toy retailer is now expected in 2012. It had filed for an IPO in May last year.

"The Dunkin' brand is not time sensitive. It has developed a huge brand awareness with Dunkin' Donuts and Baskin Robbins," said Scott Sweet, senior managing partner at IPO Boutique.

"Consumers will travel for miles to get to Dunkin' Donuts."

Dunkin' Brands, with over 16,000 outlets in 57 countries, earned $26.9 million on revenue of $577.1 million in the year ended Dec. 25.

Previously part of Allied Domecq, it competes with Dairy Queen, Cold Stone Creamery and Starbucks Corp . When Pernod Ricard the world's No.2 spirits maker, acquired Allied Domecq in 2005, it ditched the Dunkin' Brands businesses.

"Dunkin' is probably recession resistant. They have a lot of growth in their business," said BGB Securities analyst Sam Yake.

Bain Capital, Carlyle and THL would collectively will own about three-fourths of the company after the offering. None of them are selling their shares in the IPO.

In a regulatory filing on Monday, Dunkin' Brands said it expects to receive net proceeds of about $348.4 million from the offering.

Dunkin' Brands, which expects to list on Nasdaq under the symbol "DNKN," plans to use the proceeds to repay debt and for working capital.

In May, the company filed for an IPO of up to $400 million.

Post IPO, the company will have about 126.4 million shares outstanding excluding the over-allotment option.

(Reporting by Brenton Cordeiro and Tanya Agrawal; Editing by Don Sebastian and Gopakumar Warrier)