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ING U.S. IPO could value company at over $6 billion

The logo of ING is pictured at the headquarters in Amsterdam July 16, 2012. REUTERS/Robin van Lonkhuijsen/United Photos
The logo of ING is pictured at the headquarters in Amsterdam July 16, 2012. REUTERS/Robin van Lonkhuijsen/United Photos

By Aman Shah and Ashutosh Pandey

(Reuters) - Dutch financial services group ING Groep NV's unit ING U.S. plans to price shares in its IPO at between $21 and $24 each, valuing the company at up to $6.16 billion in what could be the second-largest public offering this year.

The IPO could raise as much as $1.54 billion. Pfizer Inc's animal health unit Zoetis Inc raised $2.2 billion in its February IPO.

"The price is somewhat consistent with what the management has said before. Given the current environment, this might be a price that may be achievable," Morningstar analyst Vincent Lui said.

ING Group's ownership in ING U.S. will reduce to 75 percent after the IPO.

ING Groep is splitting its banking and insurance operations as part of a restructuring deal with the European Commission, turning into a smaller Europe-focused bank.

The group received a 10 billion euro ($12.71 billion) capital infusion from the Dutch Government in 2008 and has been selling assets to repay the bailout. It sold its U.S. online banking business ING Direct for nearly $9 billion to Capital One Financial Corp in 2011.

ING U.S., which provides insurance, retirement and investment services, expects the IPO to sell 64.2 million shares of common stock, the company said in a regulatory filing on Tuesday. (http://r.reuters.com/nap47t)

"The company had a big loss in 2008 and is a type of company that potentially exposes investors to big risks," Jay Ritter, a University of Florida IPO expert, told Reuters.

"Based upon its earnings of $2.06 per share in 2012, the price range of $21-$24 is valuing at a conservative price earnings ratio of 11."

The IPO will consist of a primary component offered by ING U.S. and a secondary component offered by the parent, the company said in a statement. ING U.S.'s proceeds from the offering are intended to be about $600 million.

ING U.S. had $461 billion in total assets under management and assets under administration as of December 31. It reported net income of $473 million last year.

The IPO is scheduled to be priced on May 1 and shares will begin trading on May 2, according to a market source.

REBRANDING TO VOYA FINANCIAL

When it first filed to go public in November, the company said it intended to rebrand itself after listing and that it expected "substantial costs" in connection with the rebranding.

It announced last week that it expects to rebrand as Voya Financial following the offering.

However, the company does not expect to formally shift the majority of its advertising and marketing to the new brand name "until late 2014 at the earliest", Tuesday's filing said.

It also expects the rebranding to take about 24 months and cost $40 million to $50 million, excluding incremental advertising expenses.

The company has received approval to list its common stock on the New York Stock Exchange under the symbol "VOYA".

Morgan Stanley is the "lead-left" underwriter for the offering, with Goldman Sachs & Co and Citigroup among the lead bookrunners in a 24 bank syndicate.

ING Groep shares, which have lost close to a fourth of their value in the last three months, closed up 2 percent at 6.01 euros in Amsterdam earlier on Tuesday.

(Editing by Don Sebastian)

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