PHS braves market with £414m float

By JOANNE HART
Updated:

 

WORKPLACE services specialist PHS Group has attempted to brave volatile stock market conditions, listing at £413.6m, one of the largest flotations this year. The price of the shares was almost halved, however, to 80p from an initial range of 110p to 150p.

In partial compensation for the price reduction, Merrill Lynch, which arranged the deal, increased the number of shares in issue from just under 400m to 517m. The shares fell 3 1/2p to 76 1/2p.

PHS, founded by two brothers in 1963, provides office equipment ranging from soap dispensers to plastic plants. Sold to Electra in 1995, the company was bought by Charterhouse Development Capital for £215m in July 1999.

Under the deal, £250m of new money is being raised and £87m of existing shares are being sold. CDC will continue to own 11% of PHS and management will also have a stake.

Twelve senior managers, including chief executive Peter Cohen and finance director Keith Bland, are selling shares worth £2.4m in the float. Chairman Bob Mackenzie, who is not selling any of his shares, said: 'We are thrilled.'

Merrill Lynch, which warned on its own profits on Tuesday, is making £14m from the deal.

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