Two years ago, Rottapharm's founding family gave up on selling a big stake in the company. Word was, the offers didn't quite measure up to the asking price--and the Rovati family wanted to keep more power than buyers were willing to give.
Now, the Italian drugmaker is planning an IPO that would value the company at €1.45 billion to €1.8 billion, or up to $2.46 billion. That's almost a half-billion dollars below the family's highest previous valuation, at least according to sources close to that sale process at the time.
So, at least in the eyes of the Rovatis, the Rottapharm offering is a bargain at €7.25 to €9 per share. The company will offer 50 million shares, with an option to sell an additional 10 million.
All the shares offered come from the family concern Fidim, which will keep a 75% stake after the sale. If Rottapharm elects to offer the additional shares and underwriters exercise their over-allotment option, the company says, the family will keep 65.5%.
The IPO culminates several years of back-and-forth on ownership of the company. In 2011, founder Luigi Rovati started shopping a stake in the company to private equity buyers and pharma companies. By year's end, word was that buyers weren't willing to meet the price, and nor did they want to leave the family with 40% of the company.
Negotiations continued, but Mylan ($MYL) walked away from the table a few months later, leaving a couple of drugmakers still in the running. The family reportedly came close to a deal--with private equity firms--in 2012, but ended up deciding against it.