* Fnac shares priced at 22 euros, below some forecasts
* Fnac shares expected to fall at opening on Thursday
PARIS, June 19 Fnac shares were priced
at 22 euros a share, valuing the book and CD retailer at 365.1
million euros, market operator NYSE Euronext said on Wednesday,
providing a valuation that is likely to disappoint investors.
Fnac shares are due to make their market debut on Thursday
as part of parent Kering's decision to spin off the
business to focus on luxury and sports brands. Some analysts
were expecting a valuation of around 400 million euros ($536
Founded in 1954 by Trotskyites who wanted to make books and
music more accessible to the masses, Fnac has been struggling to
adapt to the 21st century, hit by music piracy and fierce
competition from Internet retailers such as Amazon.
Several analysts and fund managers have said in the past
week they expected Fnac shares to fall as investors offloaded
the stock they received from Kering.
PPR, which formally changed its name to Kering at its annual
general meeting Tuesday, decided to hive off Fnac after having
failed to find a buyer for the retail chain which has 170 shops.
To boost investors' confidence in the future company,
Kering's family shareholder Artemis has pledged to hold on to
its 39 percent stake in Fnac for as long as two years and keep
part of that holding thereafter.
Fnac's initial public offering is the second time the
company has listed in Paris, having floated on the bourse in
1980 before being taken private by PPR in 1994.
In the past two years, Fnac has been closing underperforming
shops. It has also recently widened its product offering to
include games, toys and household products.
Fnac sales fell 7 percent in 2011, 2.1 percent in 2012 and
5.3 percent in the first quarter of this year.
Last year, the company's operating profit fell 22 percent at
63.3 million euros, yielding an operating margin of 1.6 percent.