Lenzing AG (LNZ), an Austrian maker of viscose fibers, plans to sell 75 million euros worth of shares ($104 million) in the second quarter to fund its expansion.
At the same time, B&C Industrieholding GmbH will sell part of its 90.5 percent stake in Lenzing, according to a statement today. The “Re-IPO” will be offered to private and institutional investors in Austria and to institutional investors internationally and “substantially increase Lenzing’s free float and improve the company’s long-term access to the capital market.”
Lenzing plans to sell about 500 million euros of shares by late April in a public offering of new and existing stock, two people with knowledge of the sale said last month. A 500 million-euro share sale would raise Lenzing’s free float to more than 700 million euros and qualify it for membership on the bourse’s main ATX index, a goal identified by Chief Executive Officer Peter Untersperger in a Jan. 13 interview with Austria’s Die Presse newspaper.
The deal will help fund a 1.5 billion-euro investment to build new plants and expand existing facilities in Austria, China, India and Indonesia over the next four years, said the people, who declined to be identified because the process is confidential.
Size of Offer
“The details regarding the possible offer size, expected free float and the exact timing of any transaction will also depend on prevailing market conditions,” Lenzing said in today’s statement. “B&C plans to retain its active role as a long-term core and majority shareholder of Lenzing in the future.”
B&C’s dominant stake in Lenzing has curbed the stock’s liquidity and reduced its weighting in stock indexes, limiting investment by others. Only 54 million euros of the stock was traded in 2010, according to data from Vienna’s bourse.
B&C and Lenzing have hired Morgan Stanley as sole global coordinator for the transaction and Morgan Stanley, Deutsche Bank and UniCredit will be the joint bookrunners, according to the statement.
Lenzing, based in the Upper Austrian town of the same name, is seeking to increase production capacity as rising cotton prices boost demand for substitute fibers.
The company, founded in Nazi-occupied Austria in 1938, was taken over by a group of Austrian banks after World War II. In 2000, the principal owner, a precursor to UniCredit Bank Austria AG, endowed its industrial holdings to a charity, whose investment vehicle B&C also owns stakes in Austrian rubber maker Semperit AG and builder Allgemeine Baugesellschaft Porr AG. (POS)
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