Avast Software valued at £2.4bn in IPO

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Avast has revealed the price of its initial public offering, valuing the Czech cybersecurity group at £2.4bn(Ksh279 Billion) in one of the biggest technology listings. Although conditional trading started on Thursday, stock in the company is due to start trading on the main market in London next week at a price of £2.50(Ksh299) per share

The company raised £147.4m in gross primary proceeds, which exclude various fees, from the sale, which it will use to repay debt. The overall flotation of 25.3 percent of the company was worth £602m. “Today is a significant milestone for Avast,” said Vince Steckler, chief executive. “I am confident that our listing on the London Stock Exchange will help support further growth.”

Avast’s stock market debut is the largest in London this year and one of the five biggest from the technology sector. Since 2015, tech companies have raised £18bn in initial public offerings and follow-on listings on the London Stock Exchange. The flotation will also create a rare UK publicly listed technology company after chipmaker Arm Holdings was bought by Japan’s SoftBank in 2016 and China’s Canyon Bridge acquired chip designer Imagination Technologies last year.

Among the public companies left in the sector are Sophos, a rival cybersecurity group, which listed in 2015. Founded in the 1980s, Avast is one of the world’s largest cybersecurity companies that sell directly to consumers in a fiercely competitive market dominated by McAfee and Symantec’s Norton. Avast offers its basic products for free.

The company’s biggest shareholders are co-founders Eduard Kucera and Pavel Baudis whose combined stake will fall to 37.5 percent after the listing. Funds managed by private equity group CVC Capital Partners will own between 19.7 percent and 22.7 percent of the group, depending on whether underwriters utilize a so-called “greenshoe” provision in case of high demand.

Avast, which has 435milliom customers, opted to list in London rather than on New York’s Nasdaq as it believes its mature business and dividend plans make the UK market a natural home for the company, according to people with direct knowledge of the decision. The company reported adjusted revenues of $780m(Ksh 938m) in 2017 and adjusted cash earnings before interest, taxation, depreciation, and amortization of $451m(Ksh 540m).

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Melissa Daniels
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