Elster Group SE (ELT), a provider of gas, electricity and water meters, priced its IPO on 29th September, 2010 at $13 per ADS, well below its expected range of $16-$18 per ADS and generated a first day return of 6.2%.
Business Overview (from prospectus)
We are one of the world’s largest providers of gas, electricity and water meters and related communications, networking and software solutions. Our products and solutions
are used to accurately and reliably measure gas, electricity and water consumption as well as enable energy efficiency and conservation. We believe that we have one of the most extensive installed meter bases in the world, with more than 200 million meters deployed over the course of the last ten years. We sell our products and solutions in more than 130 countries for use in a variety of settings.
Offering: 16.2 million ADS at $13 per ADS. Net proceeds of approximately $150 million will be used for debt repayment.
Lead Underwriters: Deutsche Bank Securities (DB), Goldman, Sachs & Co. (GS), J.P. Morgan (JPM)
Financial Highlights:
For the six months ended June 30, 2010, revenues decreased by $5.9 million, or 0.7%, to $831.3 million compared to revenues of $837.2 million in the six months ended June 30, 2009...Gross profit as a percentage of revenues decreased to 30.9% in the first six months of 2010 from 30.1% in the prior year period...Selling expenses increased by $3.9 million in the first six months of 2010, or 5.0%, compared to the prior year period...Research and development expenses increased by $4.7 million, or 12.8%, in the first six months of 2010 as compared to the prior year period...net income of $19.1 million in the six months ended June 30, 2010 compared to net income of $41.8 million in the prior year period...
Competitors
Generally speaking, the global manual-read metering and Smart Grid market is characterized by several large global companies, specialized manufacturers and providers. Our primary competitors are Itron (ITRI) and Sensus in the gas, electricity and water meter markets and Landis+Gyr in the gas and electricity meter markets. Each of these competitors also offers Smart Grid solutions. In addition, as our industry has evolved in response to the use of new technology, we have also started to compete with companies outside of our industry, particularly companies in the communications, network infrastructure, software and other technology industries, with respect to the elements of Smart Grid solutions that consist of communications devices, network hardware and software. Other additional competitors, named below, are local or regional companies usually focused on one or several elements of the manual-read or Smart Grid markets.
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