WWD – Intercos Group Debuts on Euronext Milan

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The cosmetics company’s price per share was 14 euros when the market opened on Tuesday.


MILAN — It’s listed, at last.

After many false starts, Intercos Group finally debuted on the Italian Bourse on Tuesday — and the enthusiasm surrounding the event was tangible.
With flashy fuchsia banners with the company’s logo covering the Palazzo Mezzanotte building — which houses the Italian Stock Exchange — inside the firm’s founder and executive chairman Dario Ferrari and chief executive officer Renato Semerari were all smiles as they together rang the bell at the market opening ceremony.

As per tradition, they were also invited to leave a message in a book, before giving a speech in front of the Bourse’s institutional figures as well as their partners and members of the board.
“We are excited, after 50 years we’ve finally grown up,” penned Ferrari in the tome, before giving an extensive round of heartfelt thanks to his team and family.

The offering price of the shares was set at 12.50 euros, valuing the firm at 1.2 billion euros, but they rose to 14 euros when the market opened Tuesday and reached a peak of 14.78 euros roughly three hours after the opening. The shares closed at 14.60 euros.

Ferrari during his speech trumpeted the decision to go public at this moment, which was something “not everyone agreed on.” He said “there were those who wanted to postpone and those who wanted to do other things. But I believe that next year things will be difficult: We all know about the problems with the supply chain, inflation and geopolitical issues, not to mention COVID-19. It will take time before all these are solved. Yet we are in charge of a company that proved its resilience and its ability in reacting. Today we’re stronger, we still have our issues with the supply chain and logistics as anyone, but I believe we’re performing well and better than the market.”

Intuition and passion have been strong drivers throughout the career of Ferrari, who established the company in 1972. But his combination of charisma and honesty, pragmatism and a sharp sense of humor are characteristics that set the entrepreneur apart and that were on full display at the ceremony.

“It took 50 years, all my life, to take this company where it is right now. We’re leaders in our sector but with revenues that are ridiculous compared to other industries,” he said. “If it wasn’t that 50 years have passed, I would say that now we start to have fun, meaning that the quotation will give us a different image, a different standing and the opportunity to present ourselves [in a different way].

“Now we want to grow, to double [the business] and do more,” he continued in his speech. “Will the market allow us to do this? I think so, because we’re a pretty unique company. We’ve had many that copied us, but they’re more than welcome to do so because we like to have competition. Yet our business model is particular and we will continue to improve it.”

In the first half of 2021, the cosmetics supplier reported revenues of 314.6 million euros, up 13.4 percent compared to the same period last year. Before the pandemic, in 2019 the company registered revenues of 712.7 million euros, with makeup accounting for 66 percent of revenues, hair and body products for 20 percent and skin care for the remaining 14 percent.

Speaking with WWD after the ceremony, when he described the listing as both a point of arrival and a starting one, he said that “in 50 years we created the basis for the future, because if you think about it this business didn’t exist and also we had doubts in understanding if it deserved a future. We understood it only at the beginning of the 2000s and that’s the moment when we pressed on the gas pedal and became more global and started to invest more than anyone in innovation. So now the game depends only on us.”

Based in Agrate Brianza — a 40-minute drive from Milan — Intercos manufactures and supplies lipsticks, eye shadows, mascaras, foundations, powders, pencils, nail polishes and skin care products to around 680 clients globally. It employs about 5,200 people worldwide, distributed through 11 research centers, 15 production plants and 15 sales offices on three continents.

Asked if this configuration will change with new acquisitions after the listing, Ferrari shook his head. “I’m terrible at acquisitions because I can never find something that really convinces me. For me, acquiring a competitor is not worth it,” he said, underscoring that “the operations we have made, have always been aimed at diversifying what we do.”
“Of course, globalization will push us to find new solutions in America — where we want to grow a lot — and China, as we think the future will be there,” continued the entrepreneur. Yet he revealed that an operation will be soon finalized in India, as this represents another key market for the company’s growth.
“I keep hearing that the bigger [companies] eat the smaller [ones]. But let’s be careful, today the fast ones eat the slow ones, therefore it’s not a matter of dimensions any more but of speed and of grasping the opportunities of the market in a different way. So now we have to manage to be big and fast,” noted Ferrari.
To this end, the executive incited his team to get back to work “but always remembering to run, run, run. I have run for 50 years, now it’s your turn,” he said with a smile.

Ferrari also acknowledged the work of his daughter Arabella — who is the company’s senior vice president, business unit makeup — and of Semerari during a road show that was impacted by the travel restrictions due to the pandemic. “Under a certain point of view, it was easy as they didn’t move from their desks, but it was also very intense since it’s not easy to communicate through a screen. But they clearly succeeded and the results speak for themselves,” he said.

As reported, Intercos Group started procedures for the listing last month. The total value of the offering was 318 million euros, excluding the potential full exercise of the over-allotment option. The free float at the moment of admission to trading amounted to 26.5 percent of the company and it gave Intercos a market capitalization of about 1.19 billion euros.

Intercos listed about 25.4 million shares, including 3.5 million newly issued ordinary shares in tandem with a capital increase, and 21.9 million existing ones offered by the firm’s key shareholders — the L Catterton-owned CP7 Beauty LuxCo Sàrl holding company; The Innovation Trust, which is controlled by the Ontario Teachers’ Pension Plan; Dafe 3000 and Dafe 4000, two entities controlled by Ferrari, as well as the company’s own shares.

The most prominent newbie on the national stock exchange in terms of capitalization and capital collected this year, Intercos Group is the fifth company to be admitted in 2021 in the main market of the Italian Bourse, which since last week goes by the name of Euronext Milan, following its acquisition by the Euronext pan-European Stock Exchange in April.

“This will be for sure an opeation that we will remember and that will mark this year,” said Barbara Lunghi, head of the equity primary market at the Bourse.

“You could have chosen other markets, but we’re happy that you opted for Milan. It’s a recognition of the central role that this stock exchange has in the international landscape,” she added, addressing Ferrari. Lunghi further praised the company’s management for bravely restarting the procedures for the IPO after the pandemic caused a halt in its initial plans.