Ardagh to put off US flotation on turmoil in market
Group would have been valued at €2bn in planned offering
IRISH packaging group Ardagh Glass has confirmed that it is postponing a planned US stock market flotation that was expected to value the group at more than €2bn.
There had been an expectation among investors that the flotation would be mothballed and Ardagh, which is controlled by Dublin businessman Paul Coulson and his family, confirmed the move after it released second quarter results to bondholders.
Mr Coulson and his family's stake in the business was poised to be worth as much as €750m when the company made its US market debut. Ardagh chief executive Niall Wall was expected to see his 10pc stake valued at as much as €200m.
Ardagh had announced in May that it intended to float in the US in the third quarter of this year, and had filed most relevant documentation with regulators there to enable the listing to proceed.
However, global equity markets have suffered heavy slumps in recent weeks amid major doubts over the ability of the United States to sustain an economic recovery, and of the continuing threat of the debt crisis within the European Union.
A spokesman for Ardagh, which is the third largest glass container manufacturer in Europe, said there was no planned timetable for the flotation and that the company will wait until markets recover.
The company continues to look at potential acquisitions.
Analysts had previously queried whether the Ardagh flotation would proceed given the sharp downturn in equity markets, and it appears likely the flotation will be pushed into 2012.
It had been expected that the amount raised by Ardagh in the IPO would have been relatively low and that the move was more about gaining a US listing rather than a major liquidity event. It could have been aiming to raise as little as €200m.
Ardagh reported this week that its profits rose 11pc to €36m in the second quarter, but warned that it won't be able to recover all of the sharp rises in its raw material costs in the remainder of the year. Revenue at the group jumped 163pc to €854m following its €1.7bn acquisition of can manufacturer Impress from the private-equity group Doughty Hanson last year.
Earnings before interest, tax, depreciation and amor- tisation rose 99pc to €156.6m in the second quarter, while pre-tax profit was 44pc higher at €49.7m.