Springer Nature aims to raise 1.2 billion euros in new money in IPO

FRANKFURT (Reuters) - Springer Nature, the publisher of science magazines Nature and Scientific American, is planning to raise 1.2 billion euros ($1.5 billion) by selling new shares in an initial public offering (IPO), also providing an opportunity for its private equity owner to cash in.

While buyout group BC Partners will sell some of its shares in the listing, German publisher Holtzbrinck, which owns 53 percent, will hold on to its stake, Springer Nature said in a statement on Thursday.

The IPO adds to a series of listings on the Frankfurt stock exchange, which has seen heavyweights such as Siemens' medical technology unit Healthineers SHLG.DE and Deutsche Bank's DBKGn.DE asset management arm DWS DWSG.DE list in recent weeks.

Separately, cloud telephony group NFON on Thursday also announced a Frankfurt IPO. The rival to Ringcentral RNG.N and 8x8 EGHT.N hopes to reap 50 million euros in proceeds from the listing for European expansion.Springer Nature was formed in 2015 through the merger of Holtzbrinck's Macmillan Science and Education unit with BC Partners' Springer business, which publishes scientific, technical and medical books and journals.

The tie-up was designed to make it easier to compete with the likes of RELX REL.L as publishers increasingly shift to digital content and readers use smartphones and tablets to access information.

Sources close to the matter had told Reuters in late February, that Springer Nature has brought forward the listing which may value it at more than 7 billion euros including debt, to reduce the risk from volatile stock markets.

Springer Nature, which says it is the largest English language academic book publisher with 13,000 new books every year, posted revenues of 1.64 billion euros in 2017, up 2.5 percent from 2016.

Its adjusted operating income was 374 million in 2017, while adjusted earnings before interest, tax, depreciation and amortization stood at 551 million euros.

Peer RELX trades at about 14.4 times its expected core earnings. If Springer fetches a similar multiple it could be valued at up to 8 billion euros.

The bulk of the proceeds from the listing are to be used to cut net debt by a third. That currently stands at roughly 3 billion euros, and Springer Nature is targeting a leverage of 3.5 times EBITDA after the IPO.

Investors can expect a dividend payment of 110 million euros for the ending December 2018, and in following years Springer Nature expects to pay out about 50 percent of its annual adjusted net profit, the company said.

JP Morgan JPM.N and Morgan Stanley MS.N are organizing the listing as so called global coordinators with the help of bookrunners Bank of America BAC.N, BNP Paribas BNPP.PA, Credit Suisse CSGN.S, Goldman Sachs GS.N and Societe Generale SOGN.PA.

Springer Nature is a separate company from German publisher Axel Springer SPRGn.DE.

Reporting by Ludwig Burger and Arno Schuetze; Editing by Keith Weir