Carlyle-backed StandardAero targets $7.7 billion valuation in upsized IPO

(Reuters) - Carlyle-backed aviation services provider StandardAero is targeting a valuation of up to $7.69 billion in an upsized initial public offering, underscoring the strong investor appetite for profitable companies with scale.

The company is now targeting a sale of 60 million shares priced between $20 and $23 each, to fetch $1.38 billion, it said on Friday. It had earlier aimed to raise up to $1.07 billion.

Up to $155.3 million of the proceeds will go to Carlyle and Singapore's sovereign wealth fund GIC — the current investors who are selling some shares in the IPO.

Reuters had reported in April that Carlyle was weighing options for StandardAero, including a possible sale. It had bought the U.S. aircraft maintenance services provider from Veritas Capital for about $5 billion in 2019.

StandardAero, founded in 1911, counts carriers such as American Airlines (NASDAQ:AAL ) and Southwest Airlines (NYSE:LUV ) as well as aircraft engine makers Rolls-Royce (OTC:RYCEY ), GE Aerospace and Pratt & Whitney among its customers.

Its revenue jumped 12% in the first half of 2024. Net income was at $8.6 million versus a loss of $12.6 million in the year-ago period.

While the IPO market is recovering from the lows of last year, investors have still preferred established companies with stronger finances over those that lack a clear path to profitability.

According to analysts, strong post-debut performances from some startups that went public recently could also encourage more listings.



The Renaissance IPO Index, a benchmark for broader trends, is up about 14% so far this year.

J.P. Morgan and Morgan Stanley are the lead underwriters for StandardAero's IPO.

Source: Investing.com