The flotation has been described by financial news sources as the City’s largest since the UK’s decision to leave the European Union earlier this summer.
Under its plans, Biffa intends to raise an estimated £270 million from its initial offer, which comprises new shares to be issued by the company and the expected sale of existing shares.
Mid Cap specialist broker Peel Hunt has meanwhile been confirmed this morning as lead manager of the Offer, alongside Citigroup and J.P. Morgan as joint global co-ordinators, joint bookrunners and joint sponsors. HSBC has been appointed as a joint bookrunner.
The announcement comes at a time of growth for Biffa Group, which manages an estimated 6.6 million tonnes of waste per annum across its operations. In the 2016 financial year, the business recorded revenue of £927.5 million – a year on year growth of 7.4%.
In 2013, a restructuring of the Group’s debts was required, and equity ownership was transferred to a group of Biffa’s senior lenders led by Angelo Gordon, Avenue Capital Group and Bain Capital Credit through a scheme of arrangement, resulting in a reduction of the Group’s debts.
Signals
There have been strong market signals that potential suitors from the UK, China, America and elsewhere had been interested in buying the company, but Biffa chief executive Ian Wakelin told letsrecycle.com earlier in the year that a public listing is the favoured option (see letsrecycle.com story).
Commenting on the announcement today, Mr Wakelin said: “We believe there are multiple levers for continued organic growth and margin expansion in a market underpinned by structural growth drivers which favour Biffa’s service-oriented business model. Moreover, we operate in a fragmented market providing opportunities for further highly synergistic in-fill acquisitions.
“We are successfully implementing a three-pronged growth strategy, centred on growing our market presence, broadening our range of services to meet our customers’ complex needs and driving efficiencies across the business. We look forward to continuing to implement this strategy as a public company.”
‘Exciting’
Steve Marshall, chairman of Biffa, added: “I am delighted to be chairing Biffa at this very exciting time for the business as it moves on to the next phase of its development and, along with my fellow Board members, look forward to reporting on our progress as we embark on the next stage of our journey.”
Biffa has also announced the appointment of two non-executive directors to its board as of August 2016.
These are David Martin, who is also a non-executive director of Ladbrokes plc and until December 2015 served as chief executive of Arriva, one of the largest bus and train transport services in Europe.
Ken Lever also joins the board and also currently serves as non-executive director of Vertu Motors plc, Blue Prism plc, and House Strategic plc.
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