Ardagh Group, the glass and metal containers giant built up by Dublin financier Paul Coulson, pressed the start button on Monday on its initial public offering with plans to raise as much as $372.6 million (€352 million).
The company plans to sell 16.2 million shares in the deal at between $17 and $20 each, Ardagh said in a filing with the US Securities and Exchange Commission. It will also make an additional 2.43 million shares to banks underwriting the deal to sell on the market in a follow-up offering, if demand for the stock was high.
Mr Coulson (64) has been planning a flotation of Ardagh on the New York Stock Exchange since at least 2011, having built up the group over almost two decades through a series of acquisitions. Following its largest-ever deal last year, the $3.4 billion purchase of a beverage cans business from US rival Ball and the UK's Rexam, the group has been left with debt of €7.2 billion, or 5.4 times its operating earnings.
Analysts estimates the flotation, which is expected to be completed by the end of this month, could give Ardagh a market value of the dollar equivalent of more than €5 billion. Mr Coulson owns about 36 per cent of the group, which traces its roots back to the Irish Glass Bottle Company in Ringsend.
The transaction is being led by Citigroup, which will share multimillion euro fees with Deutsche Bank, Goldman Sachs, Barclays, Credit Suisse, JP Morgan, Davy in Dublin and Wells Fargo.
The share sale is being structured through the sale of so-called Class A shares, which will carry one-tenth of the voting power of remaining Class B shares that are in the hands of the company’s exiting investors.
Ardagh has spent the past year replacing much of its bonds with cheaper debt as it focused on reining in its costs. The company expects to report earnings before interest, tax, depreciation and amortisation (Ebitda) of €1.4 billion this year, up from €1.16 billion in 2016, as it gets the full benefit of the Ball-Rexam assets.
Annual sales are heading in the direction of €8 billion. Ardagh's customers include Heineken, Coca-Cola, L'Oréal and John West.
Proceeds from the share sale will be used to pay down the company’s debt, although Ardagh continues to have an eye out for further potential acquisitions, Mr Coulson said last week. Having a stock market quotation opens the possibility of the company using stock to part fund future deals.
Almost 60 per cent of the group’s revenues now come from metal containers, a business the company only ventured into in 2011.