dfsCo 2Sofa chain DFS has confirmed plans to return to the stock market in a move it hopes will raise cash to pay down debt.

DFS — the UK’s largest upholstery retailer with over 100 stores and sales of £656.8m — plans to raise £105m from the IPO to reduce borrowings and lower its cost of financing.

It plans to use all the primary proceeds of the offer — together with existing cash resources and circa £200m from its new senior facilities agreement — to repay its existing outstanding bond finance.

The IPO will also include a partial sale of shares held by private equity backer Advent together with members of the company’s management team, with a free float of at least 25 per cent of DFS’ shares following admission to the Stock Market.

DFS’ IPO has been talked about for a long period of time, and follows soon after the share sale of ScS — Britain’s second largest upholstery specialist — in the past fortnight.

CEO Ian Filby said: “Our vision is to take DFS from being a great British business to a world class business. This is an exciting time for us as we continue to drive growth initiatives that are already underway against a backdrop of an improving macroeconomic environment.”