Three cheers for finance: Worldpay has priced up its IPO today, making it the largest float in London this year. A reminder, if anyone needed it, that London is still a world-class – if not the world-class – financial centre.
The payments processor, which was hived off from the bailed-out RBS in 2010, priced its float at 240p per share this morning, around the middle of its 225p-260p range. That valued its equity at £4.8bn; shares then jumped 6.25% to 255p in conditional trading ahead of full trading starting on October 16.
That vindicates Worldpay’s decision to turn down a £6.6bn offer (a figure that included its £1.5bn of net debt) from Ingenico in September, over concerns its French rival couldn’t raise the necessary cash.
The soon to be FTSE 100 company, chaired by former CBI president Sir Mike Rake, said the listing would raise at least £2.16bn. It would get around £948m of and use to pay down the aforementioned debt. The financial firm processes around 31 million payments on a normal day, and netted underlying earnings of £375m on sales of £863m in 2012, according to its pre-IPO filing.
Meanwhile, Worldpay’s private equity owners Advent International and Bain Capital, which put around £1bn into its technology when they bought it from RBS, are set to make a tidy four times their investment, according to the FT.
Until the end of September, there had been 93 listings in London worth just £5.3bn in total, according to Reuters. That’s just half the £11bn raised from 136 IPOs in the same period in 2014. Worldpay’s IPO will also be the largest ever in the UK by a private equity-owned company. Cheers to that.