EQS-News: IONOS Group SE: United Internet and Warburg Pincus announce price range and offer structure for Initial Public Offering of IONOS Group SE

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United Internet and Warburg Pincus announce price range and offer structure for Initial Public Offering of IONOS Group SE

• IONOS Group SE shares to be offered within price range of EUR 18.50 to EUR 22.50
• Offer will consist of 21,000,000 shares from the holdings of United Internet AG and Warburg Pincus
• Possible over-allotment of up to 3,150,000 shares
• Free float of up to 17.3%, including potential over-allotments
• Price range implies a total enterprise value[1] of between EUR 3.93 billion and EUR 4.49 billion
• Offer period is expected to begin January 30 and end February 7, 2023
• First day of trading on the Regulated Market of the Frankfurt Stock Exchange (Prime Standard) planned for February 8, 2023
• Offering and listing subject to approval of prospectus by German Federal Financial Supervisory Authority (BaFin) and its publication

Karlsruhe/Berlin, January 27, 2023. United Internet AG (“United Internet”) and WP XII Venture Holdings II SCSp (“WP XII”), an affiliate of Warburg Pincus (together “Warburg Pincus”), the shareholders of IONOS Group SE (75.1% and 24.9%, respectively), today announced the price range and offer structure for the planned initial public offering (“IPO”) of IONOS Group SE (together with its subsidiaries “IONOS” or the “Company”), the leading European digitalization partner for small and medium-sized businesses (“SMB”). The price range for the IONOS shares has been set at EUR 18.50 to EUR 22,50 per share. The first day of trading for IONOS shares is expected to be February 8, 2023, under the ISIN DE000A3E00M1 and Trading Symbol IOS.

Achim Weiss, CEO of IONOS Group SE, said, “IONOS’ mission is to drive the digitalization of small and medium-sized businesses. IONOS provides digital solutions that enable businesses to operate effectively and increase their visibility online. We believe we are ideally positioned to benefit from the unstoppable trend of digitalization. The positive feedback we received from numerous investors reinforces our belief that the IPO will strengthen our successful growth trajectory. We look forward to discussing our bright future with investors in the coming weeks.”

Ralph Dommermuth, Chairman of the Supervisory Board of IONOS Group SE and CEO of United Internet AG, said, “More and more companies are moving online as part of their digitalization journey, while existing IONOS customers require more products to enhance their online presence and productivity. The large size of the market enables IONOS to capture further avenues of growth by increasing its market share. Investors’ interest in the offered shares is a clear indication of their belief in the attractiveness of IONOS’ business model and confirms that an IPO is the next logical step. IONOS has a strong management team that will continue to lead the company independently even after an IPO. We look forward to remaining a majority shareholder as IONOS starts its next chapter in its history.”

René Obermann, Co-Head Europe of Warburg Pincus and Member of the Supervisory Board of IONOS Group SE, added, “We are proud to have witnessed IONOS’ tremendous growth since Warburg Pincus started its partnership with IONOS in 2016. IONOS is now firmly positioned as the European web hosting market leader in an attractive industry benefiting from long-term trends. The IPO is an important milestone for IONOS, and Warburg Pincus looks forward to remaining part of that journey.”

IONOS is positioned as the one-stop-shop for SMBs’ digitalization needs. With its scalable platform and broad product portfolio, the Company provides businesses with mission-critical digital solutions and services. IONOS has a customer base of approximately six million customers[2] in the large and growing market of small and medium sized companies that are digitally underserved. With #1 and #2 positions for web hosting in its European core markets, IONOS is the clear leader in a fragmented market. The Company has a large geographic footprint across a total of 18 European markets as well as North America benefiting from a 25-year track record of success.

IONOS believes it has a highly attractive and best-in-class financial profile that combines growth, profitability and cash flow generation, thereby achieving and sustaining the Rule of 40[3]. The Web Presence & Productivity (WP&P) business is the Company’s strongest revenue contributor, accounting for approximately 90% of revenue[4] in 2021. IONOS benefits from recurring subscription-based and predictable revenues as well as its large, diversified and loyal customer base, and the mission-critical nature and low absolute cost of its services. The Company’s business model has proven its strength and resilience, even in times of market downturns. In addition to the Web Presence & Productivity business, the Company also offers Cloud Solutions to customers who are looking to move to the cloud as their businesses evolve. With an attractive pool of captive addressable customers and the power of very well-known brands in its core markets, the Cloud Solutions business is an additional avenue for further growth.

The offering is expected to consist of a public offering in Germany and private placements in certain jurisdictions outside of Germany. United Internet and Warburg Pincus are each offering 15% of their respective holdings, translating into 15,771,000 ordinary registered shares with no par value from the holdings of United Internet AG and 5,229,000 ordinary registered shares with no par value from the holdings of Warburg Pincus (“Base Shares”). Up to 3,150,000 additional ordinary registered shares with no par value from the holdings of United Internet and WP XII may be offered to cover potential over-allotments (together with the Base Shares, the “Offer Shares”).

The free float following the IPO, assuming placement of all Offer Shares, would be 17.3%. Depending on the final offer price and assuming placement of all Offer Shares, the total proceeds from the IPO are expected to be between EUR 447 million and EUR 543 million. The price range suggests an enterprise value[5] of between EUR 3.93 billion and EUR 4.49 billion and a total market capitalization of between EUR 2.59 billion and EUR 3.15 billion. The final offer price and allocation of the Offer Shares will be determined at the end of the bookbuilding process. IONOS, United Internet and WP XII have each agreed to a customary lock-up period of 180 days from the first day of trading. All proceeds from the sale of the Base Shares [as well as Over-Allotment Shares] will flow to the existing shareholders.

Subject to the approval of the prospectus by the German Federal Financial Supervisory Authority (Bundesanstalt für Finanzdienstleistungsaufsicht, “BaFin”), the offer period, during which purchase orders can be submitted, is expected to commence on January 30, 2023, and end on February 7, 2023. The commencement of the public offering in Germany is subject to the approval of the prospectus by BaFin and its publication, which is expected today.

Following approval by the BaFin, the prospectus and additional information will be published on IONOS Group SE’s corporate website at www.ionos-group.com.

J.P. Morgan, Berenberg, Deutsche Bank and BNP PARIBAS are acting as the Joint Global Coordinators in connection with the planned transaction. Barclays and Goldman Sachs are acting as Joint Bookrunners. COMMERZBANK, DZ BANK and Landesbank Baden-Württemberg are Co-Lead Managers.

 

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About IONOS

IONOS is the leading European digitalization partner for small and medium-sized businesses (SMB). The company serves around six million customers and operates across 18 markets in Europe and North America, with its services being accessible worldwide. With its Web Presence & Productivity portfolio, IONOS acts as a 'one-stop shop' for all digitalization needs: from domains and web hosting to classic website builders and do-it-yourself solutions, from e-commerce to online marketing tools. In addition, the company offers Cloud Solutions to enterprises who are looking to move to the cloud as their businesses evolve.

IONOS is part of the listed United Internet AG (ISIN DE0005089031).

 

IONOS press

Andreas Maurer

Phone: +49 2602 96-1275

[email protected]

 

IONOS Investor Relations

[email protected]

 

Disclaimer

This announcement does not contain or constitute an offer of, or the solicitation of an offer to buy or subscribe for, securities to any person in the United States, Australia, Canada, South Africa, Japan or in any jurisdiction to whom or in which such offer or solicitation is unlawful.

Neither this announcement nor the publication in which it is contained is for publication or distribution, directly or indirectly, in whole or in part, in or into the United States of America, including its territories and possessions, any state of the United States and the District of Columbia (the "United States"). The information in this announcement does not contain or constitute an offer to acquire, subscribe or otherwise trade in shares in IONOS Group SE in any jurisdiction. Any securities referred to herein have not been and will not be registered under the U.S. Securities Act of 1933, as amended (the "Securities Act"), and may not be offered, subscribed, used, pledged, sold, resold, allotted, delivered or transferred, directly or indirectly, in or into the United States absent exemption from, or in a transaction not subject to, the registration requirements of the Securities Act. There is no intention to register any securities referred to herein in the United States or to make a public offering of the securities in the United States.

Subject to certain exceptions under applicable law, the securities referred to herein may not be offered or sold in Australia, Canada, South Africa or Japan or to, or for the account or benefit of, any national, resident or citizen of Australia, Canada, South Africa or Japan.

This announcement does not purport to contain all information required to evaluate the Company and/or its financial position and, in particular, is subject to amendment, revision, verification, correction, completion and updating in its entirety. None of (i) IONOS Group SE or any other member of the Company, (ii) United Internet AG ("United Internet"), (iii) WP XII Venture Holdings S.à r.l., (iv) WP XII Venture Holdings II SCSp (together with United Internet, the "Selling Shareholders"), (v) Warburg Pincus LLC, (vi) J.P. Morgan SE, (vii) Joh. Berenberg, Gossler & Co. KG, (viii) Deutsche Bank Aktiengesellschaft, (ix) BNP PARIBAS, (x) Barclays Bank Ireland PLC, (xi) Goldman Sachs Bank Europe SE, (xii) COMMERZBANK Aktiengesellschaft, (xiii) DZ BANK AG Deutsche Zentralgenossenschaftsbank, Frankfurt am Main, (xiv)  Landesbank Baden-Württemberg (the persons under (vi) through (xiv) together the "Banks", and the persons under (ii) through (xiv) together the "Persons"), or (xv) any of the respective directors, officers, personally liable partners, employees, agents, affiliates, shareholders or advisers of such Persons may notify you of changes nor is under an obligation to update or keep current the announcement or to provide the recipient thereof with access to any additional information that may arise in connection with it, save for the making of such disclosures as are required by mandatory provisions of law. This announcement does not constitute investment, legal, accounting, regulatory, taxation or other advice.

Neither the announcement nor any other document or information (or any part thereof) delivered or supplied under or in relation to the securities is intended to provide the basis of any credit or other evaluation and should not be considered as a recommendation by IONOS Group SE, the Company or the Persons that any viewer of, or any person accessing, the announcement or any such other document or information (or such part thereof) should subscribe for or purchase any securities of IONOS Group SE or United Internet. Before subscribing for or purchasing any securities, persons viewing this announcement should ensure that they fully understand and accept the risks which will be set out in a prospectus, if published. Acquiring investments to which this announcement relates may expose an investor to a significant risk of losing all of the amount invested. Persons considering making investments should consult an authorized person specializing in advising on such investments. Neither this announcement, nor the prospectus, constitutes a recommendation concerning the potential offering of securities described in this announcement (the "Offering"). The value of shares can decrease as well as increase. Potential investors should consult a professional advisor as to the suitability of a possible offer for the person concerned. No reliance may be placed for any purpose whatsoever on the announcement or on its completeness, accuracy or fairness.

No person is authorized to give any information or to make any representation not contained in and not consistent with the announcement and, if given or made, such information or representation must not be relied upon as having been authorized by or on behalf of IONOS Group SE, the Company or any Person.

In member states of the European Economic Area (other than Germany), this announcement is only addressed to and directed at persons who are "qualified investors" within the meaning of Article 2(e) of the Regulation (EU) 2017/1129 and amendments thereto ("Prospectus Regulation") ("Qualified Investors"). This announcement must not be acted on or relied on in any member state of the European Economic Area (other than Germany) by persons who are not Qualified Investors. In any member state of the European Economic Area (other than Germany), any investment or investment activity in IONOS Group SE may only be available to investors who are Qualified Investors, and will be engaged in only with such persons.

In the United Kingdom, this announcement is only addressed to and directed at persons who are "qualified investors" within the meaning of Article 2 of the Prospectus Regulation (Regulation (EU) 2017/1129 and amendments thereto) as it forms part of United Kingdom domestic law by virtue of the European Union (Withdrawal) Act 2018 and who (i) have professional experience in matters relating to investments falling within article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (the "Order") or (ii) are high net worth entities falling within article 49(2)(a) to (d) of the Order (all such persons being referred to as "relevant persons"). In the United Kingdom, this announcement is directed only at relevant persons. Any person who is not a relevant person should not act or rely on this announcement or any of its contents. Any investment or investment activity to which this announcement relates is available only to relevant persons and will be engaged in only with relevant persons.

This announcement is an advertisement for the purposes of the Prospectus Regulation and legislation in connection therewith. It is not a prospectus. The public offering in Germany and listing of the shares of IONOS Group SE on the regulated market of the Frankfurt Stock Exchange (Frankfurter Wertpapierbörse) is subject to the publication of a prospectus. The prospectus is expected to be approved by the German Federal Financial Supervisory Authority (Bundesanstalt für Finanzdienstleistungsaufsicht – "BaFin") in accordance with the Prospectus Regulation regime. However, the approval of the prospectus by BaFin should not be understood as an endorsement of the shares of IONOS Group SE. Investors in the public offering in Germany should purchase shares solely on the basis of the prospectus relating to the shares and should read the prospectus before making an investment decision in order to fully understand the potential risks and rewards associated with the decision to invest in the shares. Copies of the prospectus will, following approval of BaFin, be available in Germany upon explicit request and free of charge from IONOS Group SE or one of the underwriters, or on IONOS Group SE’s website (http://www.ionos-group.com/investor-relations/ipo.html).

Unless otherwise specified, the information in this announcement on the market environment, market developments, market sizes, growth rates, market trends and competition in the markets in which the Company operates are based on IONOS Group SE's own assessments. In addition, the assessments by IONOS Group SE which are referred to herein as "Company Data Analysis" are based in part on internal market observations and on various market studies, including from Gartner (e.g., for cloud applications and services), Flexera, IDC, Bitkom Research GmbH, Germany's digital association, among others, and services commissioned from McKinsey & Company, Inc. None of IONOS Group SE, the Persons nor any of their respective directors, officers, personally liable partners, employees or agents has independently verified the data contained in the third party sources or the figures, market data or other information on which third parties have based their studies. In addition, certain of the industry and market position data contained in this announcement come from IONOS Group SE's own internal research and estimates, thus are not based on third party studies, and their underlying methodology and assumptions have not been verified by any independent source for accuracy or completeness and are subject to change. Additionally, certain sources of market data were prepared before the initial spread and/or renewed outbreak of the COVID-19 pandemic and have not been updated for the potential effects of this pandemic and assumptions around COVID-19 used thereafter may be inaccurate. IONOS Group SE, the Persons and any of their respective directors, officers, personally liable partners, employees or agents are not able to determine whether the third parties who have prepared such sources will revise their estimates and projections due to the potential impact of COVID-19 on future market developments and believe such revisions are inherently difficult to make accurately due to the nature of the pandemic and reactive measures being taken in various markets.

This announcement may contain forward-looking statements which reflect IONOS Group SE’s current view on future events and financial and operational development. Words such as "intend", "expect", "anticipate", "may", "believe", "plan", "estimate" and other expressions which imply indications or predictions of future development or trends, and which are not based on historical facts, are intended to identify forward-looking statements. Forward-looking statements inherently involve both known and unknown risks and uncertainties as they depend on future events and circumstances. Forward-looking statements do not guarantee future results or developments and the actual outcome could differ materially from the forward-looking statements.

The information contained in this announcement does not purport to be comprehensive and has not been subject to any independent audit or review. This announcement contains certain supplemental or alternative measures of operating and financial performance that are not calculated in accordance with the International Financial Reporting Standards as adopted by the European Union ("IFRS") or the German Commercial Code (Handelsgesetzbuch) and German generally accepted accounting principles, and which would be considered non-IFRS/non-GAAP financial measures. These non-IFRS/non-GAAP financial measures may not be comparable to similarly titled measures presented by other companies, including United Internet, nor should they be construed as an alternative to other financial measures that are computed in accordance with IFRS or other generally accepted accounting principles. There are material limitations associated with the use of such measures. You are cautioned not to place undue reliance on any non-IFRS/non-GAAP financial measures and ratios included herein.

Certain figures, including financial and market data, contained in this announcement have been rounded and the relevant sums may not add up to 100% due to rounding.

The Banks are acting exclusively for IONOS Group SE and the Selling Shareholders and no-one else in connection with the Offering. They will not regard any other person as their respective clients in relation to the Offering and will not be responsible to anyone other than IONOS Group SE and the Selling Shareholders for providing the protections afforded to their respective clients, nor for providing advice in relation to the Offering, the contents of this announcement or any transaction, arrangement or other matter referred to herein.

In connection with the Offering, the Banks and any of their affiliates, acting as investors for their own accounts, may subscribe for or purchase securities of IONOS Group SE or United Internet and in that capacity may retain, purchase, sell, offer to sell or otherwise deal for their own accounts in such securities and other securities of IONOS Group SE or related investments in connection with the Offering or otherwise. Accordingly, references in the prospectus, once published, to the securities being issued, offered, subscribed, acquired, placed or otherwise dealt in should be read as including any issue or offer to, or subscription, acquisition, placing or dealing by the Banks and any of their affiliates acting as investors for their own accounts. In addition, certain of the Banks or their respective affiliates may enter into financing arrangements and swaps with investors in connection with which such Banks (or their affiliates) may from time to time acquire, hold or dispose of IONOS Group SE’s shares. The Banks do not intend to disclose the extent of any such investment or transactions otherwise than in accordance with any legal or regulatory obligations to do so.

None of the Banks or any of their respective directors, officers, personally liable partners, employees, advisers or agents accepts any responsibility or liability whatsoever for or makes any representation or warranty, express or implied, as to the truth, accuracy or completeness of the information in this announcement (or whether any information has been omitted from the announcement) or any other information relating to IONOS Group SE, its subsidiaries or associated companies, whether written, oral or in a visual or electronic form, and howsoever transmitted or made available or for any loss howsoever arising from any use of this announcement or its contents or otherwise arising in connection therewith.

In connection with the Offering, the stabilization manager, or any of its agents, may (but will be under no obligation to), to the extent permitted by applicable law, over-allot shares in IONOS Group SE or effect other transactions with a view to supporting the market price of IONOS Group SE's shares at a higher level than that which might otherwise prevail in the open market. A stabilization manager is not required to enter into such transactions and such transactions may be effected on any stock market, over-the-counter market, stock exchange or otherwise and may be undertaken at any time during the period commencing on the date of the commencement of conditional dealings of IONOS Group SE's shares on the Frankfurt Stock Exchange and ending no later than 30 calendar days thereafter.  However, there will be no obligation on the stabilization manager or any of its agents to effect stabilizing transactions and there is no assurance that stabilizing transactions will be undertaken. Such stabilizing measures, if commenced, may be discontinued at any time without prior notice. In no event will measures be taken to stabilize the market price of IONOS Group SE's shares above the offer price. Save as required by law or regulation, neither the stabilization manager nor any of its agents intends to disclose the extent of any over-allotments made and/or stabilization transactions conducted in relation to the Offering.

 

^[1] Calculated on September 30, 2022 basis (i.e., expected market capitalization based on registered share capital and price range, plus net debt calculated as the sum of non-current liabilities to related parties, current liabilities to related parties, and current liabilities due to banks less receivables from related parties and cash and cash equivalents, plus lease liabilities).

^[2] as of September 30, 2022

^[3] Refers to the sum of Adjusted EBITDA margin plus annual growth rate of total revenue in 2021, each as defined by IONOS

^[4] From contracts with customers

^[5] Calculated on September 30, 2022 basis (i.e., expected market capitalization based on registered share capital and price range, plus net debt calculated as the sum of non-current liabilities to related parties, current liabilities to related parties, and current liabilities due to banks less receivables from related parties and cash and cash equivalents, plus lease liabilities).