KKR, Wendel sell €555m of Legrand shares

The partial exit of electrical business Legrand was at a price just shy of the business’ blockbuster 2006 IPO.

Kohlberg Kravis Roberts and Wendel Investissement have partially exited their joint investment in French electrical business Legrand. The two private equity firms between them sold 30 million shares generating, at a sale price of €18.50 per share, proceeds of €555 million.

Following the transaction, KKR and Wendel retain a controlling stake of around 50 percent of the business’ share capital and 65 percent of its voting rights. The liquidity of Legrand shares will be boosted by the 34 percent increase in the free float, which now stands at 44 percent of the total share capital.

“KKR and Wendel reiterate their confidence in Legrand and remain equally enthusiastic about Legrand’s robust business model and growth prospects,” the two firms said in a statement.

Following the sale at €18.50 per share, Legrand’s price has recovered marginally to around €18.70 at press time. At the beginning of the week the company had begun trading at €19.72.

The sale price was just below the €19.75 commanded when Legrand was originally floated amid a frenzied IPO market in 2006. At that time the share offering was oversubscribed by 30 times, despite the fact that shares began trading at the very top of the announced price range of between €17 and €19.75. Volatility arising from the scramble to snap up shares at one point resulted in the temporary suspension of the Euronext market.

The 2006 IPO valued the company at €5.4 billion and raised €1.14 billion. The two sponsors retained a combined 60 percent stake.

KKR and Wendel had acquired Legrand for €3.6 billion in 2002 from parent company Schneider electric. Schneider had begun the process of acquiring Legrand the previous year, but was forced to divest it when European Union regulators blocked the deal on competition grounds.