Family pocket £100m in Dunelm float
Friday 20 October 2006
The founding family of a business that started out as a Leicester market stall selling curtains pocketed £103m yesterday when the firm floated on the London Stock Exchange with a value of £340m.
Jean Adderley, who founded the company with her husband Bill in 1979 and retired six years ago, floated a 30 per cent stake, or 60.3 million Dunelm shares, with institutional investors at 170p a share. The rest of the business, which sells curtains, kitchenware and towels, remains in the ownership of the Adderley family. The stock rose on its debut to close at 185p.
The £103m windfall comes on top of a £50m dividend the Adderleys paid themselves recently. Ms Adderley is left with a 7.5 per cent stake in the 82-strong chain, branded Dunelm Mill, while her husband, a non-executive director, retains a 50 per cent holding and their son Will, who runs the business, has 12.5 per cent.
The 34-year-old chief executive said "Dunelm has been rapidly growing, and the IPO will significantly raise the company's profile and will help support the business in the next stage of its growth. We are committed to the further roll-out of our successful superstore format and believe we have the systems, team and culture in place to enable us to achieve this."
He has ambitious plans for 150 superstores in out-of-town retail parks across the country, compared with the current 65. However, there are no plans to inject the proceeds of the float into the homewares retailer.
The initial public offering was priced towards the top end of the anticipated 150p to 175p range. A spokes-woman said the family decided against pricing the float at the top of the range because it wanted committed long-term investors rather than short-term investors like hedge funds.
The float,three times oversubscribed, brought relief to the market, after the recent cut-price flotation of the travel firm Hogg Robinson which listed its shares at half the planned price.
Dunelm, which describes itself as one of the top 10 retailers operating in the £12bn UK homewares market, reported record annual results in September. It plans to open five new stores in the current financial year.
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