Proactive Investors - Draslovka, the world's biggest cyanide maker, is reportedly working with banks on a potential initial public offer in London, providing some good news for the UK market as a listing drought drags on.
The Czech chemicals giant, which produces sodium cyanide for industries including mining and agriculture, is advancing plans for an IPO by choosing underwriters for the listing, according to Reuters.
A Draslovka spokesperson confirmed that a float is "being considered as one of our options", as the company's international growth strategy requires capital.
Sodium cyanide is a chemical compound used in mining to extract gold and other precious metals from ores, in a process called cyanidation or leaching, while in agriculture its highly toxic qualities are used as a fumigant to control pests and diseases in stored grains, fruits and vegetables.
Following a number of acquisitions, the company made revenue of US$468mln last year and underlying profit (EBITDA) of US$77.3mln, results released this month showed.
Czechs please!
It will not be the first Czech company to float in the UK capital, with Czech trucking support services Eurowag (LON:WPS) floating in 2021, the same year that Czech antivirus company was taken over, having been London's biggest software IPO when it arrived in 2018.
A Draslovka IPO is likely to be welcomed with open arms in London, where salt was added to the wounds of the new listings scene last month when fellow chemicals group We Soda decided to shelve its float due to “extreme investor caution in London”.
London fell third place among Europe's IPO league table in the first half of the year – behind Istanbul and Milan – with seven flotations that raised £561mln, according to accounting giant PwC.
However, London's position may improve in the second half of 2023, as some IPOs that were postponed or cancelled may come back to the market, and as the UK government introduces reforms to make London more attractive for listings.
City brokers have been murmuring that levels of IPO enquiries have picked up markedly in the past month, but WH Ireland's massively discounted emergency cash call today suggests conditions remain extremely tough.