Trainline £500m IPO to 'kick start' 2015 pipeline

Train booking website Trainline has confirmed plans for a £500m main market listing, with a gross £75m of new cash to pay off debt and allow its private equity owners to finally move closer to an exit.

Chris Searle, capital markets partner at BDO, said: “It is encouraging, especially in light of the slowdown in Main Market IPOs at the end of 2014 and the current worries over Greece, that a high profile company like the Trainline.com has decided to float so early in 2015.

"I expect this may kick start the IPO market and encourage other companies to bring forward their IPO plans. Although there are ongoing concerns over Greece and the slowdown in China, the US and UK economies enter 2015 with a fair wind behind them and this will hopefully engender positive sentiment amongst investors towards IPOs.”

The stock market offer, which should be the first major initial public offer in London in 2015, will allow private equity owners Exponent and so-investors HarbourVest Partners and Northwestern Mutual Life Assurance to effect partial exits.

Exponent, which has hired Morgan Stanley and JP Morgan to coordinate the float, bought the business for £160m in 2006 and had made several attempts to sell or float the business since.

Trainline, whose consumer business has a 38% share of the value of total consumer online sales of rail tickets in the UK, recorded total net ticket sales of £1.4bn in its 2014 financial year, with group adjusted operating profits of £34.4bn and a strong free cash conversion rate of 103%.

Chairman Douglas McCallum said: "Trainline has grown impressively since its formation in 1997 and has a proven track record of operational excellence and financial performance of which we are extremely proud."

He added: "With a strong basis for further growth, I am confident that Trainline, as a public company, will be able to capitalise on its achievements to date and continue to grow its business in the United Kingdom and Europe."

The company said it expected admission of its shares to take place in February 2015 and, while it did not confirm its predicted market valuation, said it will become eligible for inclusion in the FTSE UK indices.