Doughty Hanson portfolio company RHM has listed on the London Stock Exchange with an offer price of 275 pence per share. Based on this price, the market capitalisation of the food manufacturer RHM stood at £958m on listing. Including net debt of £711m, RHM’s enterprise value is £1.67bn. The offer price range for RHM was set at between 228 pence and 285 pence.
The total return on Doughty Hanson’s equity investment in RHM, including its retained shareholding, is 3.4 times. Following the IPO, Doughty Hanson has retained a 33% shareholding in RHM. The value of Doughty Hanson’s retained stake in RHM at the offer price is US$544m (£311m.) Doughty Hanson is returning US$1.02bn (£585m) to investors.
Doughty Hanson bought RHM for £1.18bn in August 2000, financed by a £308m equity investment and £872m of debt. RHM is Doughty Hanson’s third realisation in the last three weeks. Doughty Hanson completed the IPO of Saft on Euronext on June 30, 2005 (enterprise value: €860m) and sold Priory Group to ABN AMRO for £875m on July 5, 2005.
Doughty Hanson has now returned US$3.67bn (£2.1bn) to investors in Fund III. Realisations include RHM, Priory Group, Dunlop Standard, ATU, Umbro and FL Selenia, representing about 164% of commitments drawn for investments at a realised gross multiple of 2.4 times. Including Saft, an investment from Fund IV, Doughty Hanson has generated in excess of US$4bn (£2.3bn) in returns for investors in the last 12 months.