LONDON/FRANKFURT/VILNIUS- Lithuanian state-owned energy company Ignitis Group is on track to launch a stock market listing in September, three sources familiar with the process told Reuters, a rare bright spot in a grim year for initial public offerings (IPOs).
The deal could raise up to 500 million euros ($592.15 million), valuing the company at around 1.5 billion euros, one of the sources said.
JPMorgan JPM.N , Morgan Stanley MS.N and UBS UBSN.S are leading the share sale, another source said.
Ignitis Group declined to comment. JP Morgan and Morgan Stanley declined to comment. UBS was not immediately available for comment.
A successful deal would inject some optimism into a European IPO market heavily disrupted by the COVID-19 crisis. While stock markets have recovered from heavy losses in March this year, investors remain cautious on new listings.
Earlier this year, a Lithuanian Finance Ministry committee published recommendations to list between 25% to 33.33% of Ignitis on the Nasdaq Vilnius - the country's main stock exchange -- with a possible secondary listing.
According to the committee, Ignitis Group would need 5 to 6 billion euros by 2030 to ensure reliable energy generation, a modern distribution network and to develop renewable energy production capabilities.
This would suggest the deal could raise up to 500 million euros, based on the valuation put forward by the sources.
Elsewhere in Europe, Polish auction website Allegro is expected to list on the Warsaw Stock Exchange in September while Vodafone VOD.L has started initial preparations to list its towers business in Frankfurt early next year.
"Appetite is returning, but focus is on companies that either are fast-growing or are defensive assets such as Ignitis," said one of the sources.
($1 = 0.8444 euros)
(Reporting by Arno Schuetze, Abhinav Ramnarayan and Andrius Sytas; additional reporting by Clara Denina. Editing by Jane Merriman) ((Abhinav.Ramnarayan@thomsonreuters.com; 0044 751 745 1044;))
