Irish-owned pan-Caribbean operator Digicel Group has cancelled its plans to raise a potential USD2.28 billion through an initial public offering (IPO) on the New York Stock Exchange, amidst concerns that volatility in equity markets would negatively impact the sale, the Financial Times writes. In a filing to the US Securities and Exchange Commission (SEC) in late September, the group revealed that it intended to offer 124.2 million ‘Class A’ shares and 193.3 million ‘Class B’ shares at between USD13 and USD16 per share. The group anticipated proceeds of the sale would be around USD1.7 billion – using a mid-point of USD14.5 per share – of which, it planned to use around USD1.3 billion to repay its existing debts, whilst the remainder would be used to finance CAPEX and acquisitions.
Explaining the decision to withdraw the IPO, the group’s chairman and founder Denis O’Brien noted: ‘Digicel has decided not to proceed with its planned IPO at this time. Despite significant support for the IPO from a high quality group of investors during the marketing period, current conditions, particularly in emerging markets, have impacted transaction momentum over recent days. Given our growth outlook, an IPO for Digicel was optional and predicated on achieving fair value for the company. Recent volatility in equity markets has seen a number of IPOs listing at a discount to their signalled price, and this was a less attractive route for us.’