Belfast Telegraph

Moy Park delays stock market listing but still has the right ingredients

By Clare Weir

A plan to delay the stock market flotation of poultry giant Moy Park is a shrewd business decision rather than a sign of trouble, according to analysts.

Northern Ireland's top company with around 11,500 employees Europe-wide, Moy Park is owned by Brazilian company Marfrig and there was speculation several months ago that it was soon to be floated on the stock market for a rumoured £1bn sum.

However, in a recent interview with Bloomberg, Marfrig's chief executive Sergio Rial said while the Craigavon-based business "is ready for an IPO" (initial public offering) the company will now consider the move next year after one of the busiest years on record for London flotations.

A spokeswoman for the company would not comment yesterday, saying that Marfrig was "in a quiet period".

Companies which floated on the stock market this year included discount retailer Poundland, Pets at Home and lifestyle group Saga.

Mr Rial told Bloomberg: "Moy Park's IPO window isn't related to Brazil's market but mostly to the number of IPOs being held and how they are priced."

Colin Walsh, chairman of the CBI in Northern Ireland and head of private equity firm Crescent Capital - who was involved in the flotation of Andor plc and Trafficmaster plc - said:

"Moy Park is an excellent and well run business which I am sure would make an attractive IPO candidate on the London Stock Exchange," he said.

"However, with debt levels coming down at the Marfrig parent, it can chose the timing of when it goes to market.

"There is quite a "traffic jam" of companies queuing up to IPO at the moment; waiting until the very best brokers and advisers are available to work with the business is a sensible thing to do when you are not under any pressure to sell shares."

Economist John Simpson said he was surprised by the postponement, with recent results for Moy Park proving very encouraging.

The firm made £33.8m in pre-tax profits in the year ending December 2013 and, along with Marfrig, enjoyed unprecedented exposure as a sponsor of Brazil's World Cup earlier this year.

Janet McCollum also became the first woman to head up a Belfast Telegraph top 100 company when she succeeded Nigel Dunlop as chief exeuctive at the start of the year.

Mr Simpson said: "The prospects for Marfrig in raising capital, by selling a part of the Moy Park group, have been steadily improving in recent years," he said.

"The judgment may indeed be that the realisable market price would be lower than they hoped.

"Alternatively, the judgment may be that the performance of Moy Park will further improve.

"From a local perspective, this decision does not detract from the strength of performance at Moy Park."

John-George Willis, partner and head of the corporate department at law firm Tughans, said that Moy Park still has all the right ingredients for a stock market listing.

"The business continues to be very profitable and all the projections indicate that when this listing happens, exponential growth is anticipated," he said.

"There has been so much for the markets to swallow this year and clearly Marfrig's advisers think that they can maximise the price by putting the listing off until the next financial year.

"Investors will have much more of an appetite once they get into 2015 and this will assist Marfrig in getting the best price for shares."

Belfast Telegraph