Reuters: Private Equity: Evonik IPO may fall apart if price too low -sources

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Evonik IPO may fall apart if price too low -sources Apr 24th 2012, 14:28 By Arno Schuetze and Matthias Inverardi FRANKFURT, April 24 | Tue Apr 24, 2012 10:28am EDT FRANKFURT, April 24 (Reuters) - German industrial conglomerate Evonik may put its planned second-quarter listing on ice if valuations in the chemical sector remain at current levels, two sources close to the transaction said. "The risk remains that the valuation that Evonik's owners are hoping for will not be achieved," one of the people said. "Evonik's owners want to see an equity value of at least 15 billion euros ($19.7 billion). Right now it looks like they would get only 13.5 to 14 billion", he said. "At this valuation, they won't float Evonik." However, if after strong first quarter results the market would be gauged as robust enough to accept a higher price, Evonik's owners are likely to publish an intention to float on May 25. The initial public offering or IPO could then come a month later. The RAG Foundation, which owns a 75 percent stake, and 25-percent owner CVC hope the IPO will give Evonik an enterprise value of 6.5 to 7.5 times earnings before interest, taxes, depreciation and amortization, included, the sources said. RAG, CVC and Evonik declined to comment. Link this Share this Digg this Email Reprints

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