Europe’s largest private equity group CVC Capital Partners has postponed plans to go public in the first half of this year as market turmoil stands in the way of a billion-dollar IPO it hoped to launch in June.
The buyout group has told analysts it expects its IPO, a historic shift for a mysterious company that has been in private hands for three decades, to take place this fall or early 2023, two people with knowledge of the matter said.
CVC plans to list just 10 percent of its business, one of the people said. The group was valued at around €15 billion last year when it agreed to sell a minority stake to Blue Owl’s Dyal Capital unit.
Markets were rocked by inflation, interest rate hikes, slowing growth and the war in Ukraine, bringing a hot IPO market to an abrupt halt. Less than $3 billion has been raised in traditional IPOs in Europe so far this year, according to data from Dealogic, compared to $32.7 billion in the same period last year.
CVC intends to be listed on Amsterdam’s Euronext Stock Exchange, a blow to the London Stock Exchange which has struggled to attract large and successful listings. CVC has its roots in the British capital, where it was spun off from a division of Citigroup in 1993.
It plans to build out its back-office functions and hire more investor relations staff over the next few months as it prepares for the listing, one of the people said. It has set a target of €25 billion for its next private equity fund.
CVC said no decisions had been made about the schedule.
Only two companies have raised more than $500 million in European IPOs so far this year, Oslo-based Vår Energi and Milan-based Technoprobe, figures from Dealogic show. Both have priced their deals at the low end of their target ranges.
CVC’s rival buyout group, Bridgepoint, went public in London last year, becoming the first major private equity group in decades. Shares are down nearly 25 percent from their IPO price.
Swedish company EQT went public in 2019 and has grown to become the world’s highest-rated private equity firm, with shares trading well above their market price.
CVC plans to keep most or all of the lucrative profits it makes from buying and selling businesses in private hands while providing public investors with the proceeds from its smaller but more predictable management fee income, the Financial Times reported in January . The model is similar to that used by EQT.
CVC has €157 billion in committed funds and 25 offices around the world, according to its website. It is best known for deals such as Formula 1, the Six Nations Rugby Tournament in Europe, communications company Teneo and Unilever’s tea business.
Additional reporting by Nicholas Megaw
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