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Last Updated: Wednesday, 25 January 2006, 08:42 GMT
Qinetiq names float price range
QinetiQ at Portsdown Hill near Portsmouth
Qinetiq's military products are expected to attract strong demand
Qinetiq, the defence firm being floated by the UK government, says it expects to have a stock market value of up to 1.3bn ($2.31bn).

The group said shares in its initial public offering (IPO) would be sold in a range of 165p to 205p a share.

The listing in London next month is expected to raise 536m-629m, of which 150m will be kept by the company.

The Ministry of Defence (MoD) and US private equity firm Carlyle Group are Qinetiq's two main shareholders.

The MoD owns 56% of the company, and Carlyle 31%. Their holdings would be cut to about 23.7% and 12.9% respectively following the flotation.

The float will be the first privatisation by the Labour government since it came to power in 1997 and has attracted strong interest from investors.


Earlier this month Defence Secretary John Reid said the government would maintain a "special share in Qinetiq to protect the United Kingdom's defence and security interests".

The company's products include military sensors and software, and banking security systems, while its clients range from the Pentagon to jet engine firm Rolls-Royce and credit card company Barclaycard.

"We are delighted by the level of investor interest that has been shown at this stage in the IPO process," said Sir John Chisholm, chairman of Qinetiq.

The company added that 45m of the proceeds will be used to reduce the gap in its pension fund.

The flotation has attracted controversy because of the large profits that the Carlyle Group is set to make through the sale. The private equity group bought its stake in Qinetiq for 42m in 2002.

Qinetiq employs more than 9,000 people across the UK.

In the year to 31 March 2005, it made operating profits of 69.7m from a turnover of 872.4m.

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08 Jan 06 |  Business
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30 Apr 02 |  Business

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