CVC, Europe’s biggest private equity group, is set to announce that it will float its shares in Amsterdam by the end of next week.
In 2021, the firm with €161bn of assets under management was valued at €15bn as part of a private deal. According to two people who have direct knowledge of these plans, the firm intends to sell its shares in an entity which will receive management fees and a portion of carried interest – the gains that it makes when it exits profitable investments.
CVC’s shareholders, including Singapore GIC, Kuwait Investment Authority, Hong Kong Monetary Authority, and US asset manager Blue Owl Capital, could sell their shares.
The plans are being announced at a moment of increased geopolitical unrest, as well as rising interest rates that will bring an end to the leveraged buyout boom which has lasted for more than a decade.
Weak investor demand led to the cancellation of listing plans by companies such as French software company Planisware, German contractor Renk, and CVC’s DKV Mobility. The shares of German shoemaker Birkenstock have dropped since they listed in New York last month.
People said that the timing of the CVC listing was not finalized and could be changed if the conflict escalated in the Middle East. The fund manager , which delayed its IPO last due to Russia’s invasion of Ukraine on a full scale, is determined to proceed this time.
CVC will likely offer a number of shares that is close to the minimum allowed by Dutch law, according to their comments. Euronext rules state that if the firm announces on Monday its intention to list, its shares may start trading as early as next month.
Blue Owl’s Dyal Capital bought a stake from CVC in 2021. The deal valued CVC at €15bn. Two people familiar with the matter say that Dyal will not sell its stake during the IPO. One person added that Dyal could buy even more shares of CVC. The three other investors invested at a much lower valuation over a decade earlier.
One person said that CVC plans to list around 10 percent of its shares. Dutch law requires that companies have at least 25% of their subscribed capital available for free. However, the exchange may allow as low as 5% in certain circumstances.
CVC raised €26bn in July for leveraged acquisitions, breaking records and defying the weak market. The firm has expanded into private credit, as well as other asset classes. This follows the path of Blackstone Global Management, KKR, and Apollo Global Management who listed their shares over a decade ago.
The group will acquire Glendower Capital in 2021. This fund manager specializes in buying stakes of private equity funds. CVC has agreed to purchaseEuropean Infrastructure Investor DIF Capital, for approximately €1bn.