Evonik Industries AG’s owners said they sold part of their stake to institutional investors to pave the way for a fourth attempt at an initial public offering of the German chemical company.
RAG-Stiftung and CVC Capital Partners Ltd. sold a stake of less than a 10 percent in a private transaction advised by MainFirst Bank AG, according to a joint statement today.
After market volatility thwarted three previous IPO attempts, the owners are now taking a step approach to achieving their goal of listing Evonik. They’re selling smaller stakes to some of the same investors that participated in the roadshows for its past IPO attempt, and the transaction will value the whole business at about 14 billion euros ($18.5 billion), according to a person with knowledge of the transaction.
“Interest was already very strong at the time of the planned listing in 2012, when market conditions in the end were too volatile,” Christian Wildmoser, a CVC partner, said in the statement. “The private placement puts us in a more positive position towards achieving an intended stock exchange listing with less effort and makes us less dependent on what is a volatile market environment.”
Both partners sold an equal amount, and the purchase price was above the indicative offers received for the company in June’s listing attempt and is in line with the valuation of specialty chemical peers, according to the statement. Both local and international investors took part in the sale.
The move mirrors plans at Apollo Global Management LLC (APO) for its chemical asset Taminco, bought in 2011 for 1.1 billion euros. Preparations are under way for a listing of the Belgian maker of amine derivatives for use in pharmaceuticals, foods, crop chemicals and solvents.
Evonik Chairman Klaus Engel said the level of interest in the transaction means investors are buying into the company’s growth strategy and it will go ahead with its planned investments of more than 6 billion euros through 2016. Evonik is driving expansion into emerging markets with ingredients and additives used in health, nutrition, and water.
While some companies have vied for assets of Evonik in a break-up scenario, an IPO has the potential to create a new entrant to Germany’s DAX benchmark index, joining incumbent BASF SE (BAS) and Lanxess AG. (LXS)
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