KKR-backed Tarkett to float

The IPO could value the company at up to €2.5bn, according to the Financial Times, and could see a payout for Tarkett's private equity backer.

KKR acquired a 50% stake in the business in January 2007 for an estimated €700m, according to unquote" data. Lehman Brothers underwrote the debt package for the deal.

Tarkett filed its document de base with the French regulatory body Autorité de Marchés Financiers (AMF) on Thursday, although a date for the IPO has not yet been confirmed.

The document de base outlines various risk factors associated with the flotation of the company, including its vulnerability to the economics and politics of Russia and other CEE markets. The region makes up 27.9% of net pro forma turnover (which reached €2.52bn in 2012) for the Tarkett group, as well as 61.4% of adjusted pro forma EBITDA (€295m in 2012).

The company also acknowledges its acquisitive strategy as a possible risk, due to its reliance in part to external growth through bolt-ons. Tarkett has a long history with international growth through acquisitions and has focused predominantly on building a strong market presence in the US over the past five years.

In 2007, the same year of KKR's acquisition, Tarkett acquired US sports surface specialist Defargo and swiftly followed this in 2008 with the bolt-on of US athletic track company Beynon Sports Surfaces. In 2009 and 2010, the company acquired US-based Atlas Track and Centiva respectively and bought Tandus, originally a Chinese company with a long history as a carpet importer to the US, in 2012.

The company also made several non-US acquisitions over the last five years. It bought Brazil's Fademac in 2009 and the UK's Rhinofloor in 2010, as well as acquiring a stake in Spanish company Poligras Iberica. In 2011, the company acquired French wooden floor specialist Parquets Marty. Tarkett also created a number of partnerships with companies, namely in China, the US, the Netherlands and Turkey.

The group invested a total of €532.9m in the 2010-2012 period, comprising €94.2m spent in 2010, €95.2m spent in 2011 and €343.5m spent in 2012. The company attributes the acquisition of Tandus as the reason for the significant increase in investment spending last year.

Tarkett became established in 1987 after a couple of decades of acting as a division in various companies - the original company was founded in 1886 in Sweden. In 1997, Tarkett merged with French business Sommer Allibert. Members of the Deconinck family, which owns 50% of Tarkett, are the successors of Allibert.

Tarkett is headquartered in Paris and employs 11,000 staff. The company generated turnover of €2.3bn in 2012, as well as an EBITDA of €260.1m. Tarkett's net debt stood at €504.5m as of the end of June this year.

Michel Giannuzzi is the CEO of Tarkett and was appointed in September 2007, shortly after KKR's buyout.

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