Apollo's Watches of Switzerland announces intention to float

The proposed IPO comprises both new and existing shares, with Apollo looking to reduce its stake while remaining a controlling shareholder.

The IPO could give the group, which comprises the Watches of Switzerland, Goldsmiths, Mayors and Mappin & Webb brands, a market cap of up to £800m, according to various earlier media reports.

The latest announcement states that the business is looking to raise £155m through the process, which is earmarked for the reduction of the group's net debt to around £120m. This equates to 1.56x adjusted EBITDA before exceptional costs and non-underlying items for the year ending in January 2019. A further 15% stake could be made available through a potential overallotment option.

According to a statement released by Watches of Switzerland at the beginning of May, the group is aiming for a free float of at least 25% excluding the overallotment option.

Apollo acquired a majority stake in Watches of Switzerland in 2013. The group has since been pursuing international expansion, with a particular focus on the US market. It acquired US retailer Mayors in 2017 and now has a network of 21 stores in the country.

According to the earlier statement, the luxury watch retail group's revenues have grown at a compound annual growth rate (CAGR) of 18% since 2014 and its EBITDA has grown at a CAGR of 35.1%. The business generated adjusted EBITDA of £67.7m from revenues of £746m in the year ending in January 2019.

Watches of Switzerland operates through 125 bricks-and-mortar stores in addition to its e-commerce platform, and sells brands including Rolex, Patek Philippe, Tag Heuer, Omega, Breitling, Cartier and Audemars Piguet.

Barclays, Goldman Sachs International, BNP Paribas, Investec Bank and Rothschild & Sons are advising the group on the flotation.

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• Topics
• Exits
• UK / Ireland
• Consumer
• United Kingdom
• Apollo Management
• IPO
• Goldman Sachs
• Barclays
• BNP Paribas
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• Rothschild