While many international companies have pulled off cross-border listings on U.S. stock exchanges in the past years, few had their home base in Italy. Fewer yet were 75-year-old industrial companies like Stevanato Group, a manufacturer of glass vials, syringes and other products for the pharma, biotech and life sciences industries.
Stevanato went public on the New York Stock Exchange in July 2021, raising $672 million. Its CFO, veteran finance professional Marco Dal Lago, says the Padua-based company had six months before the IPO to build the infrastructure, assemble the talent and document and refine its processes.
With many private companies waiting in the wings to list (although the recent market downturn may stifle hopes of an imminent revival), Dal Lago shared his thoughts on how to develop the discipline and attention to detail going and staying public demands.
What aspects of the IPO process went smoother than anticipated, and what turned out to be more challenging?
Our experience was full of twists and turns, including stepping out of our comfort zone and selecting the U.S. market over public markets in our home country of Italy. While an IPO takes up to nine months to prepare, market conditions prompted us to move forward sooner than planned, so we had six months.
Despite the challenges, certain aspects went more smoothly than anticipated. For instance, the development of registration documents, investor presentations and other materials progressed efficiently, thanks to the strong collaboration between internal stakeholders, a strong audit firm, bankers and legal advisors.
We were fortunate to have seasoned board members with significant U.S. public company experience who helped us navigate the process. The cross-collaboration and expertise of our whole team helped us identify and validate every piece of operational, statistical and financial data. That was critical to the quality and credibility of the materials.
However, unexpected challenges required creative problem-solving. One notable hurdle was the level of detail required in the prospectus before it landed on the SEC’s desk. Every statistic—whether related to financials, customer data or market positioning—had to be supported by concrete evidence. Even minor details were verified and cross-referenced. The level of discipline cannot be underestimated.
This process underscored the importance of preparing governance and operational infrastructure well in advance, including internal auditing, consolidation of financial standards, SEC reporting, investor relations and legal departments.
What about the roadshow? What was that experience like?
Though virtual due to the pandemic, the schedule of investor meetings was very demanding. Management teams should expect 10 to 12 meetings per day, requiring stamina and the ability to deliver a consistent message and narrative. And the strong narrative has to be supported by data and KPIs that resonate with investors.
The meetings weren’t simply about sharing the 75-year journey of an Italian company rooted in glass manufacturing that evolved into a vital player in the pharmaceutical supply chain. It was also about demonstrating where we fit within the broader market, how we compared to industry peers and how we benefited from secular tailwinds.
Positioning ourselves as a high-value solutions provider exclusively serving the pharmaceutical industry was a turning point in gaining investor confidence. Our decision to list in the U.S. was heavily influenced by our closest peers being U.S.-based, which allowed us to draw direct comparisons for investors.
Startups often cite the cost of going and staying public as one of the disadvantages of listing. How did you approach planning for and managing the one-time and ongoing costs of being a public company?
One of the most critical steps we took early on was to assess the capabilities of our internal team. By identifying the existing strengths, we determined where we could rely on internal resources and where external expertise would be necessary.
For example, while we could marshal much of the data preparation in-house, we identified specialized areas where we had to rely on external advisors initially but defined a path to build an internal team. This early assessment helped us balance managing costs and setting ourselves up for long-term success.
In addition to thinking about talent, we assessed areas where we could drive efficiency. That included tools for SEC filings, SOX compliance planning, investor relations and ongoing training for internal teams.
The other cost that stands out is directors and officers insurance. The sticker shock we experienced was significant, which reflected the perceived risk of being a newly public company in a highly regulated industry. This is an area where CFOs need to be incredibly diligent, as costs can vary widely depending on risk assessments, the company’s industry and whether you’re considered a growth company.
In hindsight, having a more robust understanding of the factors influencing these costs earlier in the process could have helped us better manage expectations and negotiate more effectively.
How did your internal functions evolve to meet the compliance requirements of a U.S. listing?
Transitioning to a public company significantly changed our internal operations, particularly in key areas like SEC reporting, SOX compliance and investor relations. These functions required a step-by-step evolution to meet the new demands of public company life.
Our long-term goal was to build a strong internal team capable of managing these responsibilities efficiently and independently. To identify top talent, we reached into the networks of our U.S. board members to find individuals with robust public company experience, especially those who understood the nuances of SEC filings and compliance.
The shift from private to public company reporting requirements meant new processes and disciplines. The level of transparency and the cadence of reporting were dramatically different.
How did the company deal with Sarbanes Oxley compliance? Do you have any advice for other CFOs?
We took a structured approach to SOX, starting with a top-down review of all existing processes to identify gaps and weaknesses. From there, we implemented process controls and mitigation strategies to ensure compliance. We defined a roadmap, implemented a structure and identified the individuals who would assume ownership of the required steps. The external support of our experienced audit firm was crucial.
SOX compliance is a journey, not a one-time process implementation. The process requires internal audit teams to continuously document, assess and refine every process across all locations to ensure sustained compliance.
I cannot emphasize enough the level of time, effort and resources that go into SOX. You must manage a complex change management process that includes increased discipline, more rigorous processes and expanded compliance and training programs to ensure that the organization meets the many control requirements. CFOs must account for the need to train and adapt company culture accordingly.
