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Investing.com -- Kingspan Group PLC (IR:KSP) said Tuesday it has started preparations for an initial public offering (IPO) of a 25% stake in its data center-focused unit ADVNSYS, a move that could wipe out its debt.
Shares in the Irish building materials company surged more than 10% following the news.
The IPO, expected in Amsterdam as early as the first quarter of next year, will leave Kingspan with a 75% majority stake, Chief Executive Gene Murtagh told analysts.
Two global investment banks have been appointed to lead the process, the Dublin-based group said in a statement.
ADVNSYS, which designs custom infrastructure such as ventilation and daylighting for data centers, has delivered steady growth. Its earnings before interest, tax, depreciation and amortization (EBITDA) climbed to €197 million on €1.48 billion of revenue in 2024, up from €166 million on €1.35 billion the year before, according to company figures.
Murtagh said that some peers serving the data center industry trade at around 20 times earnings.
Kingspan said its ADVNSYS business, formerly known as the Advanced Building Systems segment, is well placed to capture opportunities in the fast-growing AI and data center sector.
With its "innovative product suite and global scale," the company said ADVNSYS can offer an increasingly strong proposition to customers in this market. Management added that a potential IPO could create significant value for Kingspan investors by tapping into the high valuations seen in technology and data center capital markets.
"It would give ADVNSYS a valuable sector profile in its own right, appealing to its customers and other stakeholders," the company said.