Market capitalization of Italian pharmaceutical group Rotthapharm will range between 1.45 and 1.8 billion euros equal to a price range between 7.25 and 9 euro per share, the group told in a press release published yesterday evening, telling that Italian market regulator Consob gave its go ahead to the publication of the prospectus for the sale offer of Rottapharm shares on the Italian Stock Exchange (download here the press release). The approval of Consob follows a formal communication issued on Monday June 30th whereby Borsa Italiana resolved to admit the shares to be listed on the Italian Stock Exchange.
The global offer will be made of an institutional offer starting today and of an Italian public offer starting tomorrow. Both offers will end next July 10th and the settlement date will be July 16th.
More in detail the global offer regards 50 million shares (of which 47.5 millions dedicated to institutional investors), equal to 25% of the Company’s share capital, offered by Fidim srl. The latter is the actual unique shareholder, being the holding company of entrepreneurs Luca and Lucio Rovati. Furthermore, Fidim reserves the right to increase the size of the global offer of up to 10 million shares, equal to 20% of the global offer, only to be addressed to the institutional Investors.
The prospectus explains that cash collected by Fidim thanks to the ipo will be used by Fidim to reimburse a 254 million euro financement issued by Rottapharm. Rottapharm in turn will reimburse in advance some banking credit facilities for 130 million euros and other short term lines for 36 millions (download here the prospectus).
Fidim will grant to the joint global coordinators an option to borrow additional shares up to 7,5 million shares (or 9 million shares if the upsize option is exercised in full), to cover over-allotments in the institutional offering. Fidim will also grant the joint global coordinators a greenshoe option for other 7,5 million shares (or 9 million shares if the upsize option is exercised in full).
Fidim will remain the largest shareholder of the company after the admission to trading of the shares of Rottapharm and will hold a participation in the company equal to 75% if neither of the upsize option and the greenshoe option are exercised, to 71.25% in case of exercise of the greenshoe option in full and to 65.5% in case both the upsize option and the greenshoe options are exercised in full.
This will be the end of a process began more than two years ago, when founder Luigi Rovati first entered exclusive negotiations with private equity funds Clessidra and Avista (beating proposals from Advent, Carlyle and Charterhouse), for selling them a 25 pct stake each and then changed its mind and announced he was aiming to list the company at the Italian Stock Exchange. Finally Rovati didn’t do any of the previous and in Novembre 2012 simply decided to refinance its financial debt issuing 400 million euros of high yield bonds.
The group produces both prescription and over the counter drugs as well as healthcare products (for example it owns Saugella and Babygella brands) and integrators. Rottapharm reached 536 million euros of revenues in 2013 with 130,2 millions of ebitda. Ebitda was then lower than a 160 million euros estimate madfe by the market a couple of months ago when the group filed a request with Borsa Italiana for the admission to list and trade its shares (see here a previous post of BeBeez). Net financial debt was around 250 millions at the end of 2013 and was 260 millions at the end of last March.