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Deals

Intercos prices Milan IPO in lower part of range

MILAN (Reuters) -Italian beauty products manufacturer Intercos said on Friday it had priced its initial public offering (IPO) at 12.50 euros per share, in the lower part of its initial price range, valuing the company at 1.197 billion euros ($1.40 billion).

Intercos, which is the biggest IPO on the Milan Stock Exchange so far this year, had set the indicative price range at between 12 and 14.5 euros per share.

The company raised 44 million euros from the issue of new shares, while existing shareholders such as private equity firm L Catterton and the Ontario Teachers’ Pension Plan Board sold stock worth 274 million euros.

The IPO adds to signs of a cautious new issues market. Volvo Cars cut the size of its listing and priced it at the bottom of a previously-announced range on Monday, although its shares jumped on their Stockholm market debut on Friday.

Intercos founder Dario Ferrari will maintain control of the company with 40.7% of the total share capital and 57.9% of the voting rights.

Intercos will debut on the Milan exchange on Nov. 2, with a free float of around 26.5% of its capital, before the exercise of the greenshoe option.

“Intercos came smaller and lower priced than originally planned, and with a much smaller book”, a source familiar with the transaction said on Friday.

Intercos had planned to list up to 50% of its capital in the first half of 2020, but it suspended its IPO plan due to coronavirus pandemic, sources told Reuters at the time.

The offering attracted core investors rather than speculative buyers, which limited the size of the order book and the price, but reduces risks the IPO could perform poorly in the aftermath because of “fast money” pocketing a quick profit, the source added.

At least three other groups are expected to list in Milan in the coming months - Ariston Group by the end of the year, then Sisal and Eni R&R in the first quarter of next year.

BNP Paribas, Morgan Stanley, UBS and Jefferies acted as joint global coordinators for Intercos’ IPO. Rothschild & Co was the company’s financial adviser, while Cornelli Gabelli e Associati worked with the controlling shareholders.

White & Case, Maisto e Associati, Studio Legale Giliberti Triscornia e Associati acted as legal advisers for the company, while Linklaters was legal adviser to the joint global coordinators.

($1 = 0.8570 euros)

Reporting by Elisa Anzolin in Milan and Abhinav Ramnarayan in LondonEditing by Lincoln Feast and Mark Potter

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