* DKSH and Ziggo price their share sales at top end of range
* Order books on offerings closed early due to strong demand
* Swiss-based DKSH closes 6 percent higher on market debut
By Kylie MacLellan
LONDON, March 20 (Reuters) - Big European stock market listings made a promising comeback after an eight-month hiatus when Swiss group DKSH and Dutch cable firm Ziggo sold their shares for the highest expected price on Tuesday.
Ziggo, which this week increased the size of its listing due to strong demand, raised 804 million euros ($1.1 billion) for its selling shareholders, making it the largest European initial public offering (IPO) since Spanish savings bank Bankia’s 3.1 billion euro sale last July.
European companies have largely put their listing plans on hold since the middle of last year as the euro zone debt crisis rattled stock markets and sent investors running for cover.
Even during the first half of 2011, when the market was more active, many firms pulled IPOs due to lack of investor interest, or slashed their offer price to get the sale away.
In contrast, both Ziggo and DKSH, which helps companies market and distribute their goods in Asia, were able to close the order books on their share sales early.
The offer of 30 percent of DKSH was priced at 48 Swiss francs ($52.7) per share, compared with original guidance of 42 to 48 francs, raising 821 million francs for its founding shareholders. The offering was several times oversubscribed at that price, Chief Executive Joerg Wolle said.
A large number of investors who put in orders received no shares at all, while others saw their requests scaled back, a source close to the deal said. Strongest demand came from Switzerland and the UK, the source added.
Later, Ziggo priced its offering at 18.50 euros per share, the top of its 16.50 to 18.50 euro range.
Those working in equity capital markets said the key factor for the future health of the IPO market would be how well the pair fare in the aftermarket - DKSH ended its first day trading at 51 francs, more than 6 percent above its offer price.
Ziggo will begin trading on Wednesday.
Espirito Santo said in a research note that its estimated fair value for Ziggo, based on rolling forward its net debt to the end of 2012, was 20.31 euros per share, offering a potential upside of 9.8 percent at the top end of the price range.
In a sign others were willing to test the market, UAE healthcare provider NMC Health set a price range for its London IPO, set to raise up to $281 million.
Ziggo, which reported revenues of 1.48 billion euros and earnings before interest, tax, depreciation and amortization (EBITDA) of 835 million in 2011, has said it is targeting a total dividend payout of 220 million euros this year.
From 2013 onwards, Ziggo plans a dividend of at least 50 percent of free cash flow to equity, while DKSH said in its offering circular it generally distributed 25 to 35 percent of its net profit to shareholders in any given financial year.
“They are in resilient sectors with very strong cash flow generation,” said one person working in capital markets. “These are mature assets that are at a decent yield play.”
Investors were also attracted to DKSH by its exposure to fast-growing Asia, sources close to the deal said.
DKSH, which lists Nestle, Roche and GlaxoSmithKline among its clients, posted a 26 percent rise in post-tax profit to 152 million francs in 2011, while sales rose to 7.3 billion. It made more than a third of its sales in Thailand and just over a quarter in China.
Majority shareholder Diethelm Keller Holding, which owned around 63 percent of DKSH, will remain an anchor shareholder with a stake of at least 46 percent.
Ziggo’s sale of as much as 25 percent will see its majority owners, private equity firms Warburg Pincus and Cinven , reducing their stakes. Neither sale includes any new shares.
J.P. Morgan and Morgan Stanley are the joint global coordinators for Ziggo’s IPO and joint bookrunners along with Deutsche Bank and UBS.
Deutsche Bank and UBS are also involved in DKSH’s sale, as joint global coordinators. They are also joint bookrunners with Berenberg Bank and Credit Suisse.
DKSH said it had granted the syndicate banks an over-allotment option of up to 10 percent of the shares offered, which could be exercised until April 18.