March 29, 2017 / 7:53 AM / 10 months ago

ConvaTec's majority investors raise $1.2 billion via stake sale

(Reuters) - Private equity groups Nordic Capital and Avista raised gross proceeds of 975 million pounds ($1.21 billion) through the sale of an about 19 percent stake in British medical technology giant ConvaTec Group Plc (CTEC.L), one of the joint bookrunner for the placing said.

The investors had sold 375 million shares at 260 pence per share, after the size of the placing was increased from 300 million shares due to strong investor demand, bookrunner UBS Ltd said in a statement on Wednesday.

Separately, the investors also sold 389 million shares, or a 19.95 percent stake, to Novo A/S, the parent company behind the world’s largest insulin maker Novo Nordisk (NOVOb.CO), for about 1.012 billion pounds.

On completion of the transaction, Kasim Kutay, CEO of Novo A/S, will join ConvaTec's board, Novo said separately.

ConvaTec, which focuses on the management of chronic conditions, was founded in 1978 as a division of Bristol Myers Squibb and became a standalone company when Nordic Capital and Avista acquired it in 2008.

Shares in the company were up 1.6 percent at 273.2 pence at 0733 GMT, making it the third top gainer on London's FTSE 100 index .FTSE. The firm joined the index after floating at a price of 225 pence in October.

Following the placing, Nordic Capital will own about 314 million ConvaTec shares, or an about 16.10 percent stake, while Avista will own roughly 137 million shares, or an about 7.03 percent stake.

    ConvaTec would not get any proceeds from the placing, for which Goldman Sachs International, Merrill Lynch International and UBS acted as joint bookrunners.

    Earlier this month, the company said it was well positioned for the year ahead after reporting an 8 percent increase in annual operating profit for last year.

    ($1 = 0.8070 pounds)

    Reporting by Esha Vaish in Bengaluru; Editing by Sunil Nair

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