IPL Plastics, the Ireland-headquartered maker of products including ice-cream cartons and refuse bins, has completed its long-awaited initial public offering (IPO), pricing shares at 13.50 Canadian dollars (€8.80).
Following a decline in the value of its peers, IPL priced its shares at the bottom of its previously-indicated range, raising 178.2 million Canadian dollars.
The stock began trading on the Toronto Stock Exchange on Thursday under the symbol "IPLP", opening with relatively little volume.
"We are pleased to close the IPO transaction and start trading on the Toronto Stock Exchange. Providing our existing shareholder base with access to a major regulated market has long been an important ambition for IPLP and it is especially gratifying to have finally realised that aim," said Alan Walsh, chief executive of IPL.
“With our improved balance sheet and enhanced access to capital, the company now also has the financial platform to execute our growth strategy. We intend to drive above-market organic growth, generate increased value and cash flows through capital investments and operational excellence and to be a market consolidator through strategic acquisitions,” he added.
Underwriters for the transaction included BMO Capital Markets, CIBC Capital Markets and RBC Capital Markets.
Backdrop
The IPO of IPL Plastics has taken place against the backdrop of as much as an 18 per cent slump in shares of London-listed rival RPC so far this month, as a result of concerns about a European Commission plan to ban the use of single-use plastic products.
While most of IPL Plastic's business is in North America, and only 28 per cent comes from consumer packaging products, sentiment towards the company has also been affected since the Irish company started its IPO roadshow on June 4th.
IPL’s IPO price still gives it an enterprise value of 8.5 times analysts’ 2018 earnings before interest, tax, depreciation and amortisation (ebitda), compared to a multiple of 6.2 times for RPC and 8.2 times for Berry Global, another peer.
