(Corrects to remove reference to the non-executive chairman as
one of the senior managers that could sell shares)
* Plans to raise 90 mln stg by selling new shares
* Also selling existing stock to raise free float to 25 pct
* FY revenue 326.9 mln stg, up 9 pct
* Underlying earnings 80.4 mln stg, up 9.2 pct
By James Davey and Freya Berry
LONDON, April 22 British greeting cards retailer
Card Factory plans a stock market flotation that could value it
at 1 billion pounds ($1.7 billion), joining a spate of store
chains seeking public listings as the outlook for consumer
UK retailers including discount chain Poundland,
newsagent McColl's, Pets at Home and online
fashion outlet Boohoo.com have already listed this year
on the back of improving consumer sentiment.
Fashion chain Fat Face and discounter B&M are among other
store groups set to come to market as UK economic growth picks
up and unemployment falls. A survey showed British consumer
sentiment had risen last month to its highest level since around
the start of the financial crisis in 2007.
Card Factory, which analysts have estimated to have a total
equity value of up to 1 billion pounds, said it expected to
raise 90 million pounds ($151 million) from an offer of new
shares to institutional investors.
It will also sell existing shares to raise its "free float"
of readily tradeable stock to 25 percent. A source familiar with
the matter said the value of these shares could total up to 160
Senior management, including Chief Executive Richard Hayes,
will be selling shares as part of the offering, though a source
close to the matter said the amount to be sold had not yet been
Card Factory, whose listing is planned for May, joins a rush
of flotations or initial public offerings (IPOs) seeking to
capitalise on rising stock market confidence, with Britain's
FTSE All-Share index having risen this year to an
The trend is reflected across Europe, where the value of
IPOs soared 191 percent to $15.2 billion in the first three
months of 2014, the highest first-quarter total since 2000.
Card Factory, majority owned by private equity group
Charterhouse Capital Partners, focuses on the value
and mid-market segments of Britain's 3 billion pounds-a-year
greeting cards market.
It said it sold over 285 million single cards in the year to
Jan. 31 2014 - driving revenue up 9.0 percent to 326.9 million
pounds and boosting underlying core earnings or EBITDA 9.2
percent to 80.4 million.
The company, whose profitability is illustrated by its
margin of 24.6 percent, plans to expand its 700-strong store
chain to a target of 1,200 in Britain and Ireland.
It intends to use the net proceeds from the share offer to
reduce net debt, expected to be about 160 million pounds on
Morgan Stanley and UBS are joint global
co-ordinators on the listing. Nomura is acting as joint
bookrunner, with Investec as joint lead manager. STJ
Advisors is advising the float.
($1 = 0.5951 British Pounds)
(Editing by Mark Potter and David Holmes)