Airline caterer gategroup Holding AG, part of Chinese conglomerate HNA Group Co. Ltd., has scrapped its planned listing on the Swiss stock exchange.
Gategroup said March 26 that it has decided to not pursue an IPO on Zurich-based SIX Swiss Exchange because of a "gap in valuation" under current market conditions.
The Zurich-based company was founded in 1992 as the catering division of Swiss airline Swissair. The carrier went into receivership in 2001, and the catering business, then known as Gate Gourmet, was sold in 2002 to private equity firm Texas Pacific Group, which rebranded it as gategroup.
The business was floated on the Swiss exchange in 2009 and acquired in 2016 for an equity value of about CHF1.4 billion by HNA Aviation (Hong Kong) Airline Catering Holding Co. Ltd., a subsidiary of China's HNA Group.
The Chinese owner of gategroup originally planned the offering to raise cash amid a liquidity crunch.
The IPO, originally aimed at achieving a free float of about 65%, was expected to generate proceeds of about CHF350 million for gategroup.
Gategroup employs about 43,000 staff and serves more than 700 million passengers annually from over 200 operating units in 60 territories.
Since 2015, China-based HNA has entered deals worth more than $50 billion, including the acquisition of significant holdings in Hilton Worldwide Holdings Inc. and Deutsche Bank AG. But its accumulation of debt has led to a liquidity squeeze, so the company has sold off some of its assets to raise funds.