French Cloud Provider OVHCloud Heads For Paris IPO

A major tech company from France has kicked off preparations for an initial public offering (IPO) on the country’s domestic…

OVHCloud Founder Octave Klaba

A major tech company from France has kicked off preparations for an initial public offering (IPO) on the country’s domestic exchanges in what would mark one of the landmark tech IPOs to emerge from France in recent years. It’s OVHCloud, a cloud hosting provider that’s known to be the largest of its kind in Europe. 

  • OVHCloud is akin to the AWS of Europe. It has many data centers scattered across the globe that forms the backbone of its cloud hosting services. Now over two decades since it was founded (in 1999), the company appears headed for an exit with a public listing.
OVHcloud just recently announced plans to list its shares on the Euronext Paris stock exchange which is France’s largest securities market. The company intends to raise up to €400 mn ($470mn) from the IPO, it said.
  • As usual with companies registering to go public, OVHCloud opened its books and provided major insights about its business with information not publicly disclosed before. The primary metric is revenue and profit, for which it disclosed €632mn ($741mn) in revenue and EBITDA of €255mn ($299mn) in 2020. Operating income for the same year was  €31mn ($36mn).
  • Since its start in 1999, OVHCloud has been pursuing a high growth strategy and succeeding at that. The company is pitching to investors strong growth prospects as the major attraction towards its business as it continues to expand in a growing cloud market, especially in Europe where it dominates.
  • For this year, OVHCloud expects its revenue to rise to between $768mn-$780mn compared to $741mn in 2020. Then, it’s targeting 10-15% revenue growth in 2022.
OVHCloud was founded by French entrepreneur Octave Klaba whose family has since held a majority stake in the company. The company’s press release says the family will retain a “substantial majority stake” following the IPO, implying that not much dilution will take place.

Rumors have it that OVHCloud is targeting a valuation of €4bn ($4.7bn) with its IPO, implying that it’ll be selling just about 10% of itself from its IPO. It’s no wonder that the Klaba family gets to keep a “substantial majority stake” after the listing;
  • Also, OVHCloud noted in its statement that existing shareholders outside the founding family have intentions to sell part of their stakes in its IPO. Those shareholders would be either or both KKR or TowerBrook Capital, the two American investment firms that funded OVHCloud’s only known equity round of €250mn in 2016.
By all looks, OVHCloud is a major domestic success story of the French tech industry and a public listing that’s on the horizon would be the last door to unlock to stamp such success. 

Photo: Octave Klaba, Founder & Chairman, OVHcloud. credit: Harry Murphy/Web Summit, licensed under CC BY 2.0

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