Drinks producer Stock wobbles in early trading

Oliver Smith
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STOCK Spirits Group, the Buckinghamshire-based spirits producer, fell in its first day of trading yesterday after the company floated its shares at 235p, giving the company an initial valuation of £470m.

The company’s shares initially rallied, but ended up closing down 3.8 per cent at 226p yesterday.

Stock Spirits, which is the biggest vodka producer in Poland and the Czech Republic, raised £52m from the sale of new shares to pay down debt. It said majority-owner Oaktree Capital Management and company’s management had raised £206.5m by selling down their stakes in the offering.

The initial offer price had valued Stock Spirits at around 6.9 times its 2012 core earnings, a significant discount to larger international groups such as Diageo and Pernod Ricard, which have trailing price to earnings multiples of 18.5 and 18.3 times respectively, according to Thomson Reuters data.

“I am delighted with the success of the offering and the strong response from global investors demonstrating their support of the company’s ambitious growth plans,” said Stock Spirits Group chief executive Chris Heath in a statement.

“This is a milestone in the company’s development and I look forward to the next phase as a publicly listed company,” added Heath.

JP Morgan and Nomura acted as global co-ordinators on the sale, and were also joint bookrunners along with Jefferies.