Debenhams has returned to the stock market less than three years after being bought by private equity backers CVC Capital, Merrill Lynch Private Equity and Texas Pacific. The price range of its IPO on the London Stock Exchange priced at 195 pence per share, the very bottom of the price range, which was set at between 195 and 250 pence. The IPO gives the company a market capitalization of £1.675bn.
CVC Capital, Merrill Lynch Private Equity and Texas Pacific sold 487m shares, almost 57% of the business and reportedly raised £950m. Each firm took a 30% stake in Debenhams when it was taken private in 2003 for £1.7bn. The business had been the subject of a highly competitive bidding process where a consortium led by Permira was also bidding with a recommended £1.54bn cash offer. The private equity firms each retain significant shareholdings in the business post-IPO and will commit not to sell any of their remaining holdings for at least 180 days.