Irish owned 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, said the people.
The plans may change depending on the Fed’s decision, the people said. Market conditions after the Fed meeting on September 16 and 17 will provide the nearest opportunity to set a price range for the offering, they said.
Denis O’Brien founded Digicel in 2001 in Jamaica, a year after he received a $288m windfall from selling Esat Telecom Group, the Irish telecommunications company that he built in the 1990s, to BT Group.
Digicel, which now operates in 31 markets, plans to use the proceeds from the IPO to finance capital spending, acquisitions and to pay down debt, which totalled $6.5bn at the end of June, according to company filings.
A spokesman for Bermuda-based Digicel, declined to comment on the timing of the IPO or how much the company plans to raise. In June, Digicel filed papers to sell shares in the US and said it would list them on the New York Stock Exchange.
There’s no consensus about whether the Fed will end its seven-year-old policy of zero interest rates, with 81 analysts surveyed by Bloomberg divided on the probable outcome.
For the year through March, Digicel reported adjusted earnings before interest, taxes, depreciation and amortization of $1.18bn, on revenue of $2.79bn.
The company could fetch an enterprise value of $8.4 billion to $9.6 billion, said David Holohan, head of research with Merrion Capital in Dublin. That would be seven to eight times last year’s Ebitda, including debt.
JPMorgan Chase, UBS Group and Citigroup are managing the IPO. Barclays, Credit Suisse, Deutsche Bank and Ireland’s Davy are also working on the offering.
Shares in Cable & Wireless Communications, Digicel’s main competitor in many of its markets, have fallen more than 14pc since Digicel announced its intention to go public, amid volatility in emerging and global markets. Investors have sold off riskier assets since China’s surprise currency devaluation last month.