Euro Group on track for February IPO – sources

MILAN/LONDON, Jan 13 (Reuters) – Italian industrial group Euro Group is gearing up for an initial public offering (IPO) on the Milan bourse, in what will be a test for European equity capital markets, three sources close to the matter told Reuters.

The company, in which French private equity group Tikehau Capital (TKOO.PA) holds a 30% stake, could announce its intention to float as early as next week, with a view to listing in February, one source said.

News of Euro Group’s ambitions was first reported by Bloomberg on Thursday. It comes as Germany’s United Internet (UTDI.DE) prepares to list its web hosting subsidiary Ionos, as reported.

The issue is likely to include a mix of new and existing shares, giving shareholders a chance to cash in, a second source said.

Euro Group, which produces rotors and stators for an array of applications like automotive and home appliances, is targeting a float of 30% to 40% in order to raise some 400 million euros in proceeds, a third source added.

Euro Group and Tikehau Capital both declined to comment.

The plans are contingent on market conditions, one of the sources cautioned.

Equity markets have experienced gains amid signs that inflation may be on its way down, which could lead central banks to rein in aggressive interest rate hikes. The Stoxx Europe 600 Index (.STOXX) is up more than 6% so far this month.

The CBOE Market Volatility Index (.VIX), a key indicator of market conditions, stood below 20 on Friday morning – a level that IPO bankers see as conducive to new issuance.

JPMorgan, BNP Paribas, UniCredit and Intesa Sanpaolo are global coordinators in the offering, with Rothschild acting as financial advisor, the sources said.

Reporting by Elisa Anzolin; additional reporting by Pablo Mayo Cerqueiro; writing by Pablo Mayo Cerqueiro; editing by Elisa Martinuzzi and David Evans

Our Standards: The Thomson Reuters Trust Principles.

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