Upholstery retailer DFS has announced the price range for its IPO ahead of shares beginning to trade on the London Stock Exchange on or around the 6th March.

The price range for the offer has been set at 245p–310p per share, which at the mid-point would see DFS' market capitalisation be approximately £585m.

The Doncaster headquartered group says it expects to raise gross proceeds of £98m from the issue of new shares which will be used to reduce debt and — it says — give it access to a lower cost of financing.

Recently filed consolidated accounts for DFS’ ultimate UK holding company for the year to 2nd August 2014 show EBITDA of £80m and profits at the pre-tax line of £3.6m.

Finances expenses — most of which is debt interest — totalled £57.5m — and makes up the bulk of the difference between the EBITDA and pre-tax figures. Non-cash depreciation and amortisation costs were close to £17m.

Existing shareholders will also offer shares in the float with the overall number of shares available equating to a free float of up to half the group.