Despite positive orders, the company said current market conditions didn’t produce a sufficient valuation

Ferretti Group announced this evening that it was withdrawing its offer to publicly list 30% of the company’s shares on the Milan stock exchange

The yacht builder said the number and quality of applications it received were very positive. But despite the interest shown by investors – especially Italians and Asians who supported the company and appreciated the value of the ‘Made in Italy’ brand – Ferretti said the deteriorating conditions in financial markets prevented the Company’s shares from being properly valued.

The writing was perhaps on the wall when Ferretti first announced it was extending its offer period, followed two days later by a subsequent notice that it was lowering its indicative price range for shares to between €2.00 and €2.50 down from the initial target of €2.50 to €3.70 per share. The €2 share price corresponds to a market valuation of €581 million, while the top share price the boatbuilder was aiming for would have resulted in a market valuation of €1.08 billion.  Even before the IPO was confirmed, analysts expressed scepticism about current market conditions limiting the prospects for the company’s listing.

Even with the demise of the IPO, Ferretti remained bullish stating that its recent success story gave current management and shareholders the confidence to continue to pursue its development goals and execute its fully-funded business plan. 

In an interview with Reuters, Ferretti CEO Alberto Galassi went even further in revealing the company’s future direction, “You’ll see, in 2020 a new investor will come on board,” he said, suggesting that the prospective investor might take a stake of around 30% and that talks had been underway for some time.  Reuters indicated the prospective investor was from Europe.

Ferretti was not the only company to scrap its IPO plans today. Reuters reported that Italian professional audio equipment maker RCF was also putting its plans to list on the Milan exchange on hold ’citing adverse conditions on primary markets at home and abroad.’

 

Scroll down to see more of IBI’s coverage on Ferretti’s IPO.

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