Italian industrial group EuroGroup S.p.A. is gearing up for an initial public offering (IPO) on the Milan bourse, in what will be a test for European equity capital markets, three sources close to the matter told Reuters. The company, in which French private equity group Tikehau Capital (TKOO.PA) holds a 30% stake, could announce its intention to float as early as next week, with a view to listing in February, one source said. News of Euro Group's ambitions was first reported by Bloomberg on Thursday.

It comes as Germany's United Internet (UTDI.DE) prepares to list its web hosting subsidiary Ionos, as reported. The issue is likely to include a mix of new and existing shares, giving shareholders a chance to cash in, a second source said. Euro Group, which produces rotors and stators for an array of applications like automotive and home appliances, is targeting a float of 30% to 40% in order to raise some EUR 400 million in proceeds, a third source added.

Euro Group and Tikehau Capital both declined to comment. The plans are contingent on market conditions, one of the sources cautioned. JPMorgan, BNP Paribas, UniCredit and Intesa Sanpaolo are global coordinators in the offering, with Rothschild acting as financial advisor, the sources said.