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refile-adt's ipo likely to fall short on price  -  home security systems prices-Ansjer cctv English

refile-adt's ipo likely to fall short on price - home security systems prices

by:Ansjer cctv     2020-01-21
refile-adt\'s ipo likely to fall short on price  -  home security systems prices
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Re-archive with additional coding)
Anthony Hughes, New York, January 18 (IFR)-
The US-based securities firm, ADT, will have a somewhat disappointing IPO on Thursday, possibly down about 20% from $2.
It hopes to raise money from investors.
A banker close to the deal said the underwriters told investors that the price of the deal could be around $14 a share, well below $17 a share.
The $19 range at the time of IPO listing.
"The company is disappointed with the price," the banker told IFR . ".
"But my assumption is that they will accept it.
Apollo Global Management, a private equity giant, bought the ADT for $6.
9bn leveraged acquisition in 2016.
While Apollo did not sell any of its shares in the IPO, Apollo sold 111 shares.
1 m new shares and plans to use trading gains up to $2.
To reduce debt.
At a low price of $14 per share, the earnings will drop to around $1. 55bn.
"A lot of accounts are very responsive to this price," the banker said . ".
"We have a book that oversubscribed at this level.
Morgan Stanley and Goldman Sachs are the leaders of the underwriting group.
The IPO is expected to be priced after the market closes on Thursday.
The IPO will allow Apollo to sell its investment in the company by selling ADT shares in the future.
Bankers have been looking forward to pricing IPO investors --
S. stock markets were sensitive in 2018, U. S. stock market transactions hit record highs, and comparable company prices at ipo valuations also rose.
It is understood that in the case of ADT, some investors raised objections to the company's adjusted Ebitda calculation, especially the handling of capital expenditures.
Adjusted Ebitda $2 based on mid-point pricing and ADT 2017. 32bn-$2.
37bn, ADT is seeking a valuation of less than 10 times the value of the Enterpriseto-Ebitda.
During the IPO roadshow, the ADT management described the company as "recession-
Proof of high profit margin, low requirements for working capital and maintenance capital ".
Its main purpose is to install security systems for new customers.
A key focus of the roadshow is the reduction in customer churn since Apollo control, with cash flow increasing by $100 for every 100 basis points improvement.
"Apollo bought the company a year ago --and-a-
Half ago, they were trying to change so quickly, "said one hedge --fund investor. “It’s tricky.
"ADT is the largest home security monitoring provider in the United States, but faces growing competition from surveillance apps that work directly on smartphones and other personal devices.
Even with lower valuations, IPOs could be one of the largest in the first half of 2018.
ADT plans to start trading on the New York Stock Exchange on Friday. (
Anthony Hughes reports
Editor Mark Carnegie)
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