It is the principle of a slot machine. A spin may result in a win or a loss, but only those who dare to pull the lever will find out.
No one knows this best than Lottomatica, the Italian gaming company which this week priced its IPO at EUR 9, the lower end of a recently revised range. It might be seen as yet another humbling moment for an IPO candidate determined to launch a deal in uncertain market conditions.
But backer Apollo Global Management [NYSE:APO] and management had pressing business imperatives and no time to waste, one source close to the deal said – namely reducing leverage and deploying a large-scale business plan. With bank holidays coming in Europe, the first day of trading is next Wednesday, potentially giving plenty of reflection for investors to ruminate on the listing.
Bankers on and off the deal watched the bookbuild with trepidation, fearing another IONOS [ETR:IOS], the German IPO whose flat outcome froze a multi-billion-dollar IPO pipeline for the foreseeable future.
“If this goes badly, I don’t think we will see many other IPOs in the short term,” sighed an ECM banker early this week. Another banker quipped that issuers are just desperate, and anything will do.
Still, according to data from Dealogic Italy has pulled its weight in EU ECM rankings, holding the second spot – behind Turkey and ahead of Germany - for issuance so far this year with EUR 479.25m in deal value, in large part due to the early listing of EuroGroup Laminations [BIT: EGLA]. It will take the number one spot once Lottomatica is finalised on April 28.
More IPOs and listings could be on the way. Yacht manufacturer Ferretti [HKG:9638] is untangling the technicalities and awaiting approvals from regulators ahead of its secondary listing in Milan in the next month, as reported.
Private Equity Partners-backed Italian Design Brands (IDB), the designer furniture company, recently filed an intention to float a document and is conducting investor meetings, with a deal likely to kick off in early May, as reported.
Another likely candidate is Miura Partners and Mindful Capital Partners backed ceramics group Italcer, which has filed its IPO prospectus and could list in July, as reported.
The autumn is still relatively far away, and even more promising. Family-held refrigeration machinery producer Epta postponed its EUR 2bn listing last year but could reignite the project at the end of the summer, chairman and CEO Marco Nocivelli previously told this news service.
Another comeback candidate could be Design Holding, the high-end furniture and lighting group owned by private equity firms Carlyle [NASDAQ:CG] and Investindustrial, which could also attempt a launch later in the year, although one banker said the outcome of IDB could serve as an encouragement or a warning based on its pricing once carried out.
Oaktree Capital Management [NYSE: OAK-A]-owned digital lender Banca Progetto, with a syndicate now in place, could also pull the trigger in Q4, while manufacturer Feralpi is keeping banks on the edge of their seats as they await a response on potential advisory roles for a deal with a price tag well over EUR 1bn.
Market risks are unlikely to dwindle, but in gambling, the fear of losing everything can be quickly suppressed by the irresistible possibility of being proved right.
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