PARIS (Reuters) - Weak investor appetite forced casino and luxury hotel operator Lucien Barriere to cancel what would have been one of the main listings on the French stock market since the summer break.
French hotel group Accor said on Wednesday it was withdrawing its offer to sell its 49 percent in Lucien Barriere after the initial public offering did not attract enough interest from investors.
The IPO, which valued the company at between 575 million euros ($782.6 million) and 700 million, had a price range of 16.10 to 19.60 euros. It was due to close on September 29 with a listing on October 1.
“We have decided tonight to withdraw our offer to sell, which means that the company cannot be listed,” Accor Chief Executive Gilles Pellisson told a conference call. “Our board had set itself a minimum valuation of 575 million euros and not an euro less.”
Banking sources had told Reuters on Tuesday that potential investors were being guided to a price of around 16.10 euros per share, the bottom of the range.
Among reasons for investors’ reluctance, Pelisson cited volatile stock market conditions and a shortage of comparable rivals for Barriere which made it difficult to value.
Pelisson reiterated that Lucien Barriere was not a strategic asset in the long-term for Accor and the company would continue to look at all possible options regarding the future of its stake, including selling it to a group of investors.
In the meantime, Accor, which stands to benefit from a recovery in the hotel sector and is ahead on its plans to sell assets to cut debt, could pursue its expansion while keeping the Barriere stake.
At the end of the year, Accor will be 150-200 million euros ahead of its full-year debt reduction goal of 450 million euros from asset sales, Pelisson said.
Lucien Barriere, whose rivals include Groupe Partouche, is France’s leading casino operator with a market share of 31 percent.
The century-old group owns a total of 37 casinos, 16 luxury hotels and 131 restaurants and bars, including the famous Fouquet’s restaurant on the Champs Elysees in Paris.
It had revenue of more than 1 billion euros last year and over 6,600 employees. It posted an operating profit of 26.5 million euros in it latest financial year.
The Desseigne family, which owns 51 percent of the company, had hoped the listing would raise the group’s profile at home and abroad.
“The activity of our group is sustained and our ambitions remain more than ever to continue to innovate to strengthen our various businesses,” Barriere Chairman Dominique Desseigne said in a separate statement, confirming the listing process was suspended.
(Editing by Elaine Hardcastle and David Holmes)