* Denmark's ISS aims to be listed on Copenhagen Stock
* Nordea, Goldman Sachs and UBS will be joint global
By Ole Mikkelsen
COPENHAGEN, Feb 18 Danish business services firm
ISS is planning a return to the Copenhagen stock
market with an initial public offer aimed at raising 8 billion
crowns ($1.47 billion)for the company, its third attempt at an
IPO since it was bought by private equity investors nine years
The proceeds will be used to bring down the company's net
debt, which stood at 22.7 billion crowns ($4.2 billion) at the
end of 2013, and will make it the second biggest IPO in the
Nordics since Norwegian insurer Gjensidige Forsikring
raised $1.87 billion in 2010.
Funds managed by Swedish private equity firm EQT and by
Goldman Sachs bought ISS for 22.1 billion Danish crowns
($4.05 billion) and delisted it from the Copenhagen bourse in
ISS said a partial sell-down of their shares was expected
under the IPO but did not quantify their intentions.
EQT and Goldman Sachs together hold 73 percent of ISS after
the Ontario Teachers' Pension Plan (OTTP) and KIRKBI, which
invests funds from the family behind Lego toys, injected 500
million euros ($685 million) for a combined 26 percent stake in
2012. Neither of these investors intends to sell shares in the
IPO, ISS said.
"The intended IPO is expected to support our operational
strategy, advance our public and commercial profile provide us
with improved access to public capital markets and a diversified
base of new private and institutional shareholders," Chief
Excecutive Jeff Gravenhorst said.
The company also said on Tuesday its earnings before
interest, taxes, depreciation and amortisation were unchanged
last year at 5 billion crowns on revenue down 1.3 percent at
78.5 billion crowns, due to non-core divestments and adverse
exchange rates, with underlying organic growth running at 4.3
Plans to list ISS in 2007 and again in 2011 were both
dropped because of difficult market conditions.
The company cancelled the IPO in 2011 six days after the
devastating Tohoku earthquake off Japan brought renewed
uncertainty and volatility to global financial markets.
An agreed 5.2 billion-pound ($8.69 billion) cash and shares
bid by British security services group G4S was then
abandoned in November 2011 due to resistance from G4S's
shareholders. At the time the deal had valued the company at 130
Danish crowns a share.
"I see a good chance that the IPO will be successful this
time. It is a completely different company and the financial
environment is different from what we saw in 2011," analyst
Janne Vincent Kjaer from Jyske Bank said.
Danish pension fund ATP, which ranks among the largest
pension investors in Europe with assets worth more than 500
billion crowns, said it might be interested in the offer.
"We will take a look and decide if the pricing is attractive
enough to make it interesting for us to participate," head of
equities Claus Wiinblad said.
Peers such as G4S have an enterprise value of around 10
times EBITDA according to Thomson Reuters data, a multiple that
would value ISS at roughly 50 billion Danish crowns ($9.1
billion), including debt.
Share analyst Soren Lontoft Hansen from Sydbank estimates
the enterprise value to be between $8.5 and $9.7 billion.
"We have positive equity market conditions and a low
interest rate level provides an appetite for equities and that
fuels the IPO market," Lontoft said.
Nordea, Goldman Sachs and UBS Investment Bank have been
appointed to act as global coordinators and as bookrunners along
with Barclays and Morgan Stanley, while Carnegie, Danske Bank
and SEB have been appointed as Co-lead managers. Lazard is
acting as financial advisor.
No date for the offer has been set but Gravenhorst told
reporters on a conference call that the final decision to go
ahead would be made before the end of March.