Cut-price sofa specialist DFS has returned to the stockmarket with a flotation valuing the company at £543m – near the bottom end of the range it had indicated.
The Doncaster-based furniture chain priced the offer at 255p a share, after it said last month it was seeking between 245p and 310p a share.
The shares briefly jumped above 270p in the first minutes of trading before settling down to just above the offer price.
Had the midpoint of the original range been achieved, DFS would have been valued close to £585m.
The DFS management team is hoping that the flotation of a 38% stake in the company will provide a springboard for international expansion. DFS was listed between 1993 and 2004 before being taken private.
Announcing the terms of the offer, Ian Filby, the chief executive, said: “We are committed to our vision to take DFS from being a great British business to a world-class business.
“We have a clear strategy to broaden our appeal, enhance our service and make our products more accessible to our customers than ever before through a measured programme of store expansion, continued development of our multichannel proposition and constant enhancement of our product range.”
DFS, known for selling in a huge range of colours and fabrics, is the biggest sofa retailer in the UK with almost 26% of a £3bn market. It opened its first shop near Doncaster in 1969, and has 105 stores in the UK, Ireland, and the Netherlands. The group also owns pricier chains Sofa Workshop and Dwell.
The company has opened 27 UK shops in the past four years, and plans three to five new UK shops a year, as well as new Dwell and Sofa Workshop stores. DFS said there was also potential for up to 20 more shops in the Netherlands, if the first store in north Holland proved a success.
