British tool and equipment hire company HSS Hire has announced its intention to list on the London Stock Exchange next month.
An estimated £103m is expected to be raised through the sale of shares during the Initial Public Offering (IPO), although the company could be valued at up to £600m.
Existing shareholders will be given the opportunity to sell some of their holdings in a secondary raising. According to the FT, private equity group Exponent owns 80 per cent of the company. Part of that has been sold on to other shareholders such as Standard Life.
The sale is mainly to institutional investors, although there is some opportunity for retail investors through an intermediate facility. It is being handled by JP Morgan, with Numis Securities as joint book runner.
The company, which operates from 265 branches and employs around 2,900 staff, is considered the second biggest tool hire provider in the UK. It has experienced a large increase in earnings over recent years, with revenue for the year to 27 September 2014 at £272m – up from £177m in 2011.
According to HSS Hire, the money raised will be used to reduce its current borrowing and fund future growth. Its debt is currently in a £200m publicly traded bond issued at the end of 2013.
“The listing will put our leverage position in a state that will enable us to invest more in the company by lowering interest payments,” said Chris Davis, chief executive of the company.