Tool and equipment-hire company HSS plans to raise £100million as it targets a stock market listing next month.
HSS Hire Group, which was acquired by Exponent Private Equity in 2012, could be valued up to £600million on the London stock exchange.
HSS, which said it is the second-biggest provider of tool and equipment hire in the UK, operates from 265 locations including Aberdeen and Inverness, as well as offering agencies in Thurso and Stornoway, and has about 2,900 staff.
It said it intends to use the £103million of primary proceeds to reduce its current borrowing and to fund future growth.
London-based Exponent is expected to sell some of its shares in the firm but will remain its biggest shareholder. Other investors, such as Standard Life and directors and managers, will also cut their stakes. HSS will also issue new stock.
The company has been owned by a variety of venture capital firms since 2004, when 3i backed a £145million management buyout (MBO) from the Davis Service Group. The firm was then sold in 2007 to former Asda boss Archie Norman’s investment vehicle Aurigo and hedge fund Och-Ziff. They led a restructuring of Hess which has hit by a downturn in sales of power tools and DIY equipment.
Chris Davies, Chief Executive, said the business had “outperformed” the UK tool and equipment hire market in recent years.
He added: “Having built a well-differentiated market position and a scalable business model underpinned by capital efficiency, we have an exciting opportunity ahead of us as we implement our growth plans.
“A public listing will put the business on the best footing to maximise our potential as the recovery in our markets gains momentum, enabling us to scale our model faster and accelerate our growth.”
Its revenue in the year to 27 September was £271.6million, against £177million in 2011.
The company was founded in 1957 by Bert Taylor in London.