Debenhams returns to the bourse, plans to raise £990 million

Debenhams returns to the bourse, plans to raise £990 million

	Published : Thu, 20 Apr 2006 15:25 By : Amy Watts Print this Story

LONDON: Britain's second largest department store owner Debenhams Ltd. is planning an initial public offer selling shares worth 990 million pounds. The IPO will value the firm between 1.675 billion pounds and 1.95 billion pounds.

The company and its current investors will be selling about 449.4 million new and existing shares -- 314.6 million to be issued by the company, from which it expects to raise 700 million pounds, and 134.8 million shares by the shareholders. The price band will be 195 pence to 250 pence a share.

Debenhams, once a listed company, got itself delisted after it was bought by a group of investors, comprising CVC Capital Partners Ltd. Texas Pacific Group, Merrill Lynch Global Private Equity and its management team, for 1.72 billion pounds in 2003.

The company had received a 2.05-billion-pound refinancing in 2005 and it intends to raise on its part 700 million pounds, which will be used to repay debts.

The percentage of Debenhams' enlarged share capital in the offer is 55 per cent. Texas Pacific Group, CVC Capital Partners and Merrill Lynch Global Private Equity will continue to retain significant stakes post-IPO.

The company's chairman John Lovering, chief executive Rob Templeman and finance director Chris Woodhouse can sell up to 30 per cent of their shares in the offer. They have committed to not selling any of their remaining holdings for a year.

Debenhams runs some 123 department stores in the U.K. and Ireland. It has its own brands in clothing, including Designers at Debenhams, along with third-party labels such as Jasper Conran and Julien Macdonald.

It said its same-store sales in the 26 weeks ended 4 March rose 0.6 per cent to 1.2 billion pounds. It had said in November that annual pretax profit more than doubled to a record 238.6 million pounds as sales gained 9.7 per cent to 2.09 billion pounds.

The IPO will be managed by Citigroup Inc., Credit Suisse Group, Merrill Lynch & Co. and Morgan Stanley. The shares are on sale from Thursday and the final price will be set 4 May.

Analysts say the flotation will be one of the biggest in the year.