Oberthur Backs Out of IPO Plan, Adding to French Listings' Lackluster Year

The Advent International-backed company blamed market conditions for its decision to shelve the public offering.
By Paul Whitfield ,

French digital security company Oberthur Technologies Group has postponed an initial public offering that would have been one of Europe's biggest technology listings this year, making it the second high profile French IPO to be abandoned in recent days.

Advent International Corp.-backed Oberthur had been expected to seek a valuation of €1.7 billion to €1.9 billion ($1.9 billion to $2.1 billion) but said Wednesday it had delayed its sale because of market conditions.

The decision comes five days after another high-profile IPO was pulled, when French music streaming site Deezer dropped plans to raise €300 million, also blaming market conditions.

"This decision, taken with our majority owner Advent International, is a direct consequence of market conditions," said Oberthur CEO Didier Lamouche.

European markets have experienced spikes in volatility in recent months due to concerns over the economy, including worries that slowing growth in China and a downturn in Brazil will hurt profits. Despite that, French equity markets had appeared relatively supportive since Oberthur announced its IPO on Oct. 20. France's key CAC 40 index has risen 7% in the past two weeks.

The decision to pull the sale extends a bad year for French IPOs, which have lagged global markets both in value and number. Only five French companies have come to the market since the start of the year, raising a total $3.3 billion, according to figures collated by Renaissance Capital. That has left the Paris bourse trailing traditionally smaller markets including Rome and Stockholm in terms of IPOs.

France's amour for IPOs may have been cooled by the performance of shares in Showroomprivé, which came to the market on Oct. 30. The online retailer hoped for a valuation of as much as €890 million, but had to settle for €660 million after shares were priced at the bottom of a price fork of €19.50 to €26.30. Its stock subsequently tumbled to below €17 on Monday before rebounding to trade at €18.76, still below its IPO price, on Wednesday.

Oberthur is the world's No. 2 maker of payment cards. Advent put it on the block earlier this year before opting for an IPO because bids failed to match its own valuation. Oberthur had planned to use cash from the sale to repay €376 million of shareholder loans and €230 million of senior debt. 

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