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Vodafone Group Plc is looking to raise 2 billion euros ($2.4 billion) from an initial public offering of its European mobile-phone towers unit in Frankfurt, in what will be one of the region’s biggest stock market listings this year.
The U.K. telecommunication giant plans plans to sell shares in Vantage Towers AG at 22.50 euros to 29 euros apiece, according to a statement Tuesday. Vodafone is targeting maximum proceeds of 2.8 billion euros from the offering, which would include an option to increase the deal size and an over-allotment. The final number of shares sold will depend on where the IPO prices. Vodafone shares climbed 2% to 128.60 pence at 11:18 a.m. in London.
Vantage has gathered enough investor demand to cover the full deal size of its offering, according to terms seen by Bloomberg.
Two investment funds, Digital Colony and RRJ, agreed to buy 500 million euros and 450 million euros of stock, respectively, in the offering, which will run through March 17. The new stock will start trading on March 18. The IPO values Vantage at as much as 14.7 billion euros. Vodafone will use the proceeds to pay down some of its debt pile, the company has said.
The presence of cornerstone investors makes the remaining shares more scarce and could help push pricing for Vantage’s IPO into the upper half of the range, New Street Research analyst James Ratzer said by email, adding that they also pose a risk to the company’s liquidity for other shareholders.
by Ella Jones | Linkedin
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