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UPDATE 2-Novo Nordisk plans market listing for IT business within five weeks
February 9, 2015 / 7:41 AM / 3 years ago

UPDATE 2-Novo Nordisk plans market listing for IT business within five weeks

* Says market has improved since shelved plan last year

* IPO could value IT business at up to $760 mln (Adds chairman and CEO quotes, analysts, background)

By Teis Jensen

COPENHAGEN, Feb 9 (Reuters) - Danish drugmaker Novo Nordisk aims to spin off its IT services operation NNIT within the next five weeks through an initial public offering (IPO) that analysts say could value the business at up to 5 billion Danish crowns ($760 million).

Novo had been expected to seek a Copenhagen listing for NNIT last year, but the November bankruptcy of newly listed Danish shipping fuel provider OW Bunker cooled interest in Danish IPOs.

“Peer companies are traded 10 percent higher now than in the autumn ... so we think it is an attractive time to list NNIT,” said Jesper Brandgaard, chief financial officer at Novo Nordisk and chairman of NNIT.

Brandgaard would not comment on the size of the IPO nor on how much of the business would be retained by Novo, the world’s largest insulin maker and biggest Nordic company by market capitalisation. However, he did note that in the past five Danish IPOs between 40 percent and 60 percent of the shares had been sold.

“If everything goes well we will have NNIT listed on the Copenhagen Stock Exchange in four to five weeks,” Brandgaard told Reuters.

NNIT is one of Denmark’s leading IT services businesses, with 265 million crowns in operating profit last year on revenue of 2.4 billion crowns, and CEO Per Kogut said he does not expect OW Bunker’s demise to have a negative effect on the planned IPO.

“We have a very high degree of transparency in our business and we are certain smart investors can see the difference,” Kogut said.

Brandgaard, meanwhile, pointed to the success of industrial enzyme maker Novozymes since it was spun off in 2000. The business is now the sixth-largest company on the Copenhagen market.

Analysts from Sydbank and Alm estimate that the NNIT offering could value it at between 3 billion and 5 billion Danish crowns, though they do not expect an overly aggressive price range because a negative experience for investors would hurt Novo’s image.

Danske Bank and Morgan Stanley are coordinators and bookrunners, while Skandinaviska Enskilda Banken is co-lead manager. ($1 = 6.5853 Danish crowns)

Editing by Sabina Zawadzki and David Goodman

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