Citing a “more integrated approach” to commercial space development by U.S. airports, Dufry Group said it is considering an initial public offering of its North American business, including both duty free and duty paid travel retail. The company said it will retain a majority stake in the business.
“The IPO would create significant flexibility to capitalize on trends specific to the North American travel retail market, such as its focus on food and beverage,” Dufry Group CEO Julian Diaz said.
“As North American passenger traffic is increasing, airport authorities are dedicating more commercial space to retail opportunities and adopting a more comprehensive and integrated approach to its development as compared to other regions in the world,” he continued. “An IPO would provide the North American business with financial flexibility and a separate focus, enabling it to better take advantage of these growth opportunities.
Diaz said proceeds from an IPO would be used initially to reduce leverage, allowing Dufry to reach its target leverage ahead of time.
The company said that after the IPO Dufry intends to retain a majority stake in the North American business and continue to fully consolidate it. “The business would remain an important component of Dufry’s global diversification strategy, and its operations would remain integrated with Dufry Group across all major functions, allowing the North American business to continue to benefit from Dufry’s expertise and scale in the global travel retail industry,” the company said in a statement.
The announcement about the IPO consideration came in Dufry’s reporting of its results for the first half of 2017. For Dufry Group overall, turnover grew 5.8 percent to CHF3.82 billion (US$3.95B) in the first half of 2017. The company’s turnover in its North American operations reached CHF849.5 million (US$878.3M), up from CHF790.1 million (US$816.8M) in the first half of 2016.