MILAN — Intercos Group has set the terms for its initial public offering on the Italian Bourse, which would value the cosmetics manufacturer at between 1.1 billion euros and 1.3 billion euros.
After receiving approval of its prospectus from the Italian Bourse’s watchdog CONSOB on Wednesday, the company filed the request for admission to trading of its ordinary shares on the Mercato Telematico Azionario, or MTA, which is Italy’s leading equity market dedicated to mid- and large-size companies.
The offer price range of the shares has been set between 12 euros and 14.50 euros. The offering period will kick off on Thursday and it is expected to end on Oct. 28 — subject to extension or early termination — while trading is expected to start on Nov. 2.
Reserved to qualified investors in Europe and the U.K. as well as foreign institutional investors, the offering will include 3.5 million newly issued ordinary shares of the company resulting from a capital increase, whose net proceeds will fund the development of the group’s business and support the implementation of its strategic goals.
The offering will also include the sale of 21.9 million shares, the vast majority of which will be from the firm’s key shareholders L Catterton-owned CP7 Beauty Luxco Sàrl holding company; The Innovation Trust, which is controlled by Ontario Teachers’ Pension Plan; Dafe 3000 and Dafe 4000, two entities controlled by Intercos Group’s founder and executive chairman Dario Ferrari, as well as the company’s own shares. Ferrari is expected to retain control of the company through the adoption of an increased voting rights mechanism.
CP7 Beauty Luxco Sàrl and Ontario Teachers’ Pension Plan own 33.8 percent and 20.6 percent of the company, respectively. Last year, Ferrari and his family holding Dafe signed an agreement with an affiliate of the Singapore sovereign wealth fund GIC for the sale of minority stakes in the subholdings that control Intercos. At the end of the operation, GIC held a minority stake in Dafe 3000 Srl, Dafe 4000 Srl and Dafe 5000 Srl, which together control 44.4 percent of Intercos.
As part of the offering, the selling shareholders have granted a greenshoe option in favor of the joint global coordinators — BNP Paribas, Morgan Stanley, UBS and Jefferies — for the purchase of up to about 2.6 million shares. Following the completion of the offering, assuming the full exercise of the greenshoe, the free float will amount to up to about 29 percent of the company.
As reported, the company started procedures to list on the Bourse earlier this month, after several false starts in the past.
The group was planning an IPO last year, but it was postponed due to the pandemic and consequent change in market conditions. Before that, listing plans were shelved given the poor economic climate in 2006, while in 2014, the firm presented a formal request to list on the Italian Stock Exchange, but in a rapid turnaround, it concluded its road show and released a statement the week before the official listing to withdraw the entire offering, pointing again to deteriorating market conditions.
Hints about the intention to proceed with this plan again resurfaced earlier this year, when the company signed an agreement with Italian bank Intesa Sanpaolo for a 30-million-euro sustainability-linked financing to support the achievement of its ESG targets.
Founded in 1972 by Ferrari and based in Agrate Brianza — a 40-minute drive from Milan — Intercos manufactures and supplies lipsticks, eye shadows, mascaras, foundations, powders, pencils, nail polishes and skin care products to around 680 clients globally. It employs about 5,200 people worldwide, distributed through 11 research centers, 15 production plants and 15 sales offices on three continents.
In 2019, the group reported revenues of 712.7 million euros, up 3 percent compared to the previous year. In particular, makeup accounted for 66 percent of revenues, hair and body products for 20 percent and skin care for the remaining 14 percent.