Monday 22 January 2018

Fed's rate decision could trigger Digicel float timing

Denis O'Brien founded Digicel in 2001
Denis O'Brien founded Digicel in 2001

Joe Brennan

Digicel Group could seek to raise between $1.5bn (€1.32bn) and $2bn through a US stock market listing as soon as this month, people with knowledge of the matter said.

Digicel's operations span the Caribbean and South Pacific. The company is preparing an initial public offering (IPO) that could take place as soon as after the US Federal Reserve reviews US interest rates next week, the sources said.

The plans may change depending on the Fed's decision. Market conditions after the Fed meeting on September 16 and 17 will provide the nearest opportunity to set a price range for the offering.

Businessman Denis O'Brien founded Digicel in 2001 in Jamaica, a year after selling Esat Telecom to BT Group. Digicel, which now operates in 31 markets, plans to use the proceeds of the IPO to fund capital spending and acquisitions as well as to pay down debt, which totalled $6.5bn at the end of June, according to company filings.

A spokesman for Digicel declined to comment on the timing or size of the IPO. In June, Digicel registered to sell shares in the US and said it would list them on the New York Stock Exchange.

Digicel reported adjusted earnings before interest, taxes, depreciation and amortization (ebitda) of $1.18bn, on revenue of $2.79bn in the year to the end of March.

The company could fetch an enterprise value of $8.4bn to $9.6bn, said David Holohan, head of research with Merrion Capital in Dublin, seven to eight times last year's Ebitda, including debt.

JPMorgan Chase, UBS and Citigroup are managing the IPO. Barclays, Credit Suisse, Deutsche Bank and Ireland's Davy are also working on the offering. (Bloomberg)

Irish Independent

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