Cable operator Numericable is planning to sell shares at between €20.30 and €24.80 each in a listing scheduled for early November.
Overall the company, which is operating in France, Belgium and Luxembourg, is looking to raise €652.2m (US$900.7m),…
Cable operator Numericable is planning to sell shares at between €20.30 and €24.80 each in a listing scheduled for early November.
Overall the company, which is operating in France, Belgium and Luxembourg, is looking to raise €652.2m (US$900.7m), including €250m in new shares and €402.2m in existing shares sold by private equity owners Carlyle and Cinven, it said in a statement. Both firms own about 37.5% of the company each.
There is an overallotment option to sell additional existing shares, representing 15% of the offering. The transaction also includes an employee share offering amounting to €2m.
CEO Eric Denoyer was quoted saying during a press conference today that the IPO price range values the company at between €5.06bn (US$7bn) and €5.57bn (US$7.7bn), including €2.75bn (US$3.5bn) in debt.
Pricing will take place on 7 November while trading on NYSE Euronext in Paris is scheduled for 8 November. Proceeds from the offering will be invested in developing its fibre network, Denoyer said.
The IPO will be split between a public offering in France aimed at retail investors, and an international offering, including in France, to institutional investors.
Deutsche Bank and JP Morgan are global coordinators on the offering, while Credit Agricole, HSBC and Morgan Stanley are joint bookrunners. Jefferies, Nomura and Oddo are also working on the transaction.
In late September, Numericable registered its ‘base document’ with the French financial markets’ regulator, a required first step in the process. At the time, the CEO said that the IPO would be accompanied by a €200m-€250m (US$271m-US$339m) capital increase in order to reduce the cableco’s net debt.
Numericable said it had revenues of €1.3bn in 2012. According to a Reuters report, the company’s 2012 EBITDA €590.8m gives it a post-IPO valuation ratio of enterprise value to EBITDA between 8.6 and 9.4. Similar cablecos are trading at an average of 9.5x EBITDA, the report said citing Espirito Santo.
French businessman Patrick Drahi’s Altice, Numericable’s third investor besides Cinven and Carlyle, was recently quoted saying it is looking to raise its stake in the cableco from 24% to 30% through the planned listing.
Cinven and Altice jointly acquired Numericable in 2006. A year later they snapped up French enterprise-focused telco Completel, which was later merged with the cableco. Carlyle bought into the businesses in 2008 by investing €1.1bn.
Other options, as opposed to an IPO, had been explored for Numericable over the last few months. In late February, it was suggested that Numericable was preparing a cash offer for Vivendi’s telecoms unit SFR with the view to a possible future merger. But SFR chairman Stephane Roussel said at the time that a listing of the mobile operator, rather than a merger with Numericable, was in the pipeline.
Rival carrier Bouygues had also been tipped as a potential acquirer of Numericable.
Investor demand for the cableco, which offers TV, internet and fixed-line services, is therefore expected to be high given potential deal and synergy opportunities with other telcos in the future.
The European cable industry has seen increased deal activity this year, including US cableco Liberty Global’s purchase of UK-based counterpart Virgin Media for around US$23.3bn. Meanwhile, Vodafone recently completed its acquisition of Germany’s KDG. And last year, Dutch cable company Ziggo was floated in a €925m transaction.
