Aerospace parts maker Doncasters targets $4.4 billion valuation in US IPO

By Arasu Kannagi Basil

June 15 (Reuters) - ‌Doncasters is ​targeting a ​valuation of up to $4.43 billion in its U.S. initial public offering, becoming the latest aerospace firm to test investor appetite for ‌new listings.

The Derby, United Kingdom-based company is seeking up to $746.7 ⁠million in the IPO by offering 23.3 million shares priced between $28 and $32 apiece, it said ‌on Monday.

The U.S. IPO market has ‌gained momentum after a choppy start to the year, with aerospace and defense as well as AI infrastructure themes dominating the lineup since April.

Doncasters ​will follow Arxis and Applied Aerospace & Defense, fellow aerospace parts makers that have gone public in New York since April.

"The sector buzz can ⁠support strong pricing, with investors looking for companies that can show demand, for example through government contracts with ​long-term agreements and deliverable backlogs," IPOX Research Associate Lukas Muehlbauer said.

The company's journey began in 1778 in Sheffield, UK, as ​a file-making business and has since evolved ‌into a major global aerospace and industrial parts supplier.

Doncasters, which competes with Howmet and Precision Castparts, makes a wide range ⁠of complex parts - including blades and vanes - for aerospace engines and industrial gas turbines.

The listing would mark a critical milestone in the turnaround of the nearly 250-year-old company, ⁠which completed a debt restructuring in 2020 after being taken over by its lenders from ​the now-defunct buyout firm Dubai International Capital.

Doncasters has since more than doubled its revenue, investing more than $170 million to expand capacity and modernize its facilities.

"The caution is that Doncasters ‌is still loss-making amid heavy investments into expanding capacity, so investors will focus on whether those investments can translate ‌into profits," Muehlbauer said.

Certain existing shareholders have agreed to buy roughly $66 million of Doncasters ⁠shares in a concurrent private ‌placement.

Jefferies and Morgan Stanley ​are lead joint bookrunners. Doncasters will list on the NYSE under the symbol "DPC".

(Reporting by Arasu Kannagi Basil in Bengaluru; Editing by ‌Vijay Kishore)

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