As the IPO market gets back on its feet and private equity owners seek to exit their investments, bankers are getting ready to list more retailers on the London Stock Exchange, the Financial Times reported. In the next two months, Poundland and Pets at Home are set to file their flotations, jumpstarting a slew of public listings in the UK, the report said.
Two sources told FT that Warburg Pincus-owned Poundland is looking for a valuation of anywhere from £700 million to £800 million when it submits its IPO application next month. It plans to list its shares as early as March, the report said.
Two people also told FT that KKR-owned Pets at Home may also file for a flotation in February. The float is forecasted to value the biggest pet store chain in the UK to around £1.5 billion, with its debt included, the report said.
A rising number of companies backed by private equity are looking to capitalize on the investor demand for consumer stocks which are forecasted to benefit from UK's economic resurgence. These firms include The Card Factory, Game Group and Fat Face. Citi and Jefferies were already appointed by casual retailer Fat Face to give advice on possible IPO, the report said.
Sources also told FT that privately-owned convenience store chain McColl's may also unveil its plans for an IPO as soon as next week. A stock market listing may also be an option for House of Fraser as early as next month in case discussions with Galeries Lafayette will not be successful, the report said.
Private equity owners and lenders are counting on investors to still patronize retail stocks even as high street retailers continue to face competition from internet retailers. Niche retailers, discounters and convenience stores are faring better compared to mass market retailers like Debenhams and Wm Morrison, the report said.
Join the Conversation