The recovering economy and the rally in global equity markets is set to tempt a number of companies to float in the next six months, with property group Investa and retail group Ascendia set to hit the stock exchange in big floats.
Ascendia, which owns the Rebel Sports and A-Mart All Sports chains, this morning named Goldman Sachs, Bank of America/Merrill Lynch and UBS to advise on its initial public offering, likely to take place in early 2010. The float has been valued at somewhere between $800 million and $1 billion.
The $750 million Investa float will be the first in the listed property space since December 2006. The sector has been smashed by the global financial crisis, with most companies in the sector forced to sell off assets to reduce their debt levels.
Indeed, Morgan Stanely, which bought Invseta at the height of the property boom in 2007, is likely to face substantial losses on the value of a number of properties to be included in the IPO.
According to reports, Investa will join Myer in attempting to float before Christmas.
The company joins a growing list of floats and possible floats. Many of these companies were purchased by private equity firms during the private equity boom that lasted from 2005 to 2007.
Myer
The float of the department store chain is the most anticipated in years, despite some analysts claiming that the company’s private equity owners, TPG, may have already extracted most of the value. However, investors appear to be flocking to back the float, which should end up being worth around $3 billion.
Kathmandu
Australian born, New Zealand-based entrepreneur Jan Cameron sold Kathmandu in 2006 to private equity firm Goldman Sachs JB Were and Quadrant Private Equity, who are now looking to float the company before Christmas. Former Qantas boss James Strong was recently named chairman and the offer is expected to be valued at $400 million.
Red Group Retail
Private Equity Partners owns this holding company which controls book chains Borders (in Australia), Angus & Robertson, Whitcoulls and two smaller chains, Calendar Club and SupaNews. A float is not expected until next year.
Witchery
Solomon Lew’s son Peter Lew sold the Witchery women’s fashion chain to Gresham Private Equity in 2006 for around $130 million. Speculation is growing that the company may be listed next year.
Godfreys
Vacuum cleaner retailer Godfreys was purchased by Pacific Equity Partners (PEP) and CCMP Capital Asia in May 2006 and is seen as a candidate for a float next year.
James was the editor and publisher of SmartCompany and LeadingCompany for five years. He is now the Australian Financial Review‘s companies & markets editor, and a former BRW editor.
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