B&M European Value Retail SA, the owner of UK discount chain B&M Bargains, will be valued at as much as £2.9bn pounds ($4.9 billion) when it sells shares in an initial public offering next month.
The shares will be offered in a range of 230 pence to 290 pence each, according to terms obtained by Bloomberg News. The lowest price implies a market capitalization of £2.3 billion.
B&M is pressing ahead with its IPO as a rising volume of deals tests investor demand and competing share sales increase. Last week was Europe’s busiest for IPOs in 2014, according to data compiled by Bloomberg, although UK. insurance provider Saga Plc priced its sale at the bottom of an offered range and retailer Fat Face Group Ltd. canceled its offering.
Shares of companies that have gone public in Europe this year have underperformed the wider market. The Bloomberg European IPO Index, which tracks companies that have sold shares, has risen by about 1% in 2014, compared with a gain of about 5% in the STOXX Europe 600 Price Index.
B&M, whose UK stores sell everything from televisions to bed linen, has said it plans to raise about £75 million in the IPO to reduce debt. Clayton Dubilier & Rice LLC will also sell a proportion of its holding in the retailer. The buyout firm acquired a “significant” stake in December 2012.
Between 25% and 40% of B&M’s shares will be freely traded after the IPO, excluding an over-allotment option, the terms show. The final price is expected to be set on June 11, with share dealings set to commence on June 12.
Bloomberg
