Custom Yacht Maker Sanlorenzo Sees ‘Perfect Window’ for 2019 IPO

(Bloomberg) -- Sanlorenzo SpA, an Italian builder of luxury yachts, is planning an initial public offering this year to capitalize on a “perfect window” to list shares and fund future growth.

Current market conditions play to the company’s strengths, owner and Executive Chairman Massimo Perotti said in an interview in Milan. Rival super-yacht maker Ferretti SpA has also set an IPO in Milan.

Perotti, who bought Sanlorenzo in 2005, sees his company -- with its boutique, custom-made business model -- as “more resilient and less cyclical than competitors.”

Ameglia, Italy-based Sanlorenzo produces 50 made-to-measure yachts every year through 450 direct employees and more than 1,500 local artisans.

“We look for sustainable growth, maintaining scarcity, uniqueness and price premium,” the chairman said.

Sanlorenzo is the only shipyard selling made-to-measure vessels in the 24 to 34-meter range, Perotti said, and is world leader in design, manufacturing and sales of yachts between 30 and 40 meters. Entry price: about 4.5 million euros ($4.94 million).

“It’s a completely different and unique experience,” Perotti said, comparing his company’s yachts to buying tailor-made rather than off-the-rack clothing.

Perotti, who owns 95% of Sanlorenzo, plans to keep control with a majority stake. After the IPO, which will include a primary offer, Sanlorenzo expects to have a broadly debt-free capital structure. Management is also considering the possibility of a future dividend, Perotti said.

Sanlorenzo last month filed its application to list on the Italian exchange and expects the launch of the offering to start by year end.

Milan has had a frothy year for IPOs, thanks in part to a fall in the number of new share sales in London, traditionally the most active exchange in Europe. Members of the financial community, including Generali SpA Chief Executive Officer Philippe Donnet, have also pointed to improved investment conditions under the country’s new government.

Results for the first nine months of the year confirmed the outlook for 2019 earnings, Perotti said, with expected net revenue from new yachts between 430 million euros and 456 million euros and earnings before interest, taxes, depreciation and amortization between 62 million euros and 66 million euros.

Shares of Ferretti, which competes with Sanlorenzo in some segments, are expected to start trading on Oct. 16 at a valuation of as much as 1.08 billion euros. Ferretti, partially owned by the Ferrari family, sells yachts under brands including Itama, Wally and Riva.

To contact the reporter on this story: Chiara Remondini in Milan at cremondini@bloomberg.net

To contact the editors responsible for this story: Celeste Perri at cperri@bloomberg.net, Jerrold Colten, Dan Liefgreen

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