C&C holds firm as UK floats pulled

C&C's investor roadshow moves to Britain this week just as two companies there pulled their own plans to float on the London stock market.

Directories business Yell and DIY chain Focus Wickes have both abandoned £1 billion sterling-plus (€1.55 billion-plus) flotation plans because of rocky stock market conditions.

In a statement, Yell, which was expected to be valued at the bottom of its £1.8-£2.3 billion sterling price range, said it had decided to withdraw the plans "in light of poor equity market conditions".

Focus Wickes, expected to be priced at about £1 billion sterling - scaled back from a £1.4 billion price - said it was postponing its float "in the light of adverse market conditions".

The moves will put pressure on coming flotations such as C&C and Burberry, the upmarket retailer being spun off from Argos owner GUS.

British institutional reaction to C&C's proposals over the coming days will be crucial to the success of its plans to float later this month. Already, C&C has had to price its initial public offering - the largest since Eircom came to the Irish market - between €2.60 and €3.60, 30 per cent below initial expectations.

Since then markets have continued to tumble with US-based accounting scandals undermining investor sentiment.

Traders in Dublin were divided yesterday on whether the flotation would go ahead.

"It is still too early to say but the reaction in the UK will be critical," said one.

"The mood out there is poor. It is interesting that C&C is trying to raise as much money as another niche group, Focus Wickes, which is in DIY, an area you would think would do well in Britain in the current climate."

Others were more upbeat, saying the offering would proceed unless another WorldCom upset the mood.

However, all agree that C&C will only get off at the lower end of the price range. C&C is due to float on July 10th in Dublin and London.

It is hoped the bulk of the shares will be taken up by Irish and UK investment houses.