MILAN Milan airport operator SEA hopes to be valued at as much as 1.1 billion euros ($1.4 billion) on its stock market debut in Milan next month, a source close to the deal said on Friday.
The initial public offering (IPO) of up to 23.8 percent in the company will see the Province of Milan sell its stake of 34.1 million shares, the source said, adding that the listing would also include 24.4 million new shares.
SEA said on Friday it had set a price range of 3.2 euros to 4.3 euros each for the shares, making the total size of the offering as much as 252 million euros ($322.36 million).
The Province of Milan is selling its 14.6 stake to help fund investments it needs to make. The City of Milan, which with a 56 percent stake is the airport's largest shareholder, does not plan to sell any shares.
After months of inactivity, Europe saw a pickup in share sales in October with companies including German insurer Talanx (TLXGn.DE), Britain's Direct Line (DLGD.L) and Telefonica Deutschland (O2Dn.DE) successfully completing market debuts.
The market is still far from robust, however, with investors unsettled by a faltering global economy and governments needing to rein in deficits on both sides of the Atlantic.
SEA, which runs the two airports of Malpensa and Linate in Italy's financial capital, plans to set a final price for the listing on December 3 and will make its debut on the Milan market three days later, the source said.
The IPO will also include an over-allotment option of 8.8 million shares, the source said.
Infrastructure investment fund F2i, which bought a stake of just under 30 percent last December when the company was valued at around 1.3 billion euros, has been keen for SEA to float a larger stake, a different source said.
In the first nine months of the year SEA saw a 5.3 percent rise in its core earnings to 126.9 million euros, while debt at the end of September amounted to 334.5 million euros.
In the first 10 months of the year the number of passengers at the airports fell 2 percent to around 23.7 million.
Banca IMI, Mediobanca, Morgan Stanley and UniCredit are coordinating the sale, and are bookrunners along with BNP Paribas and Deutsche Bank. ($1 = 0.7817 euros) (Reporting By Massimo Gaia, Writing by Stephen Jewkes, Editing by Luca Trogni and Elaine Hardcastle)