The Myer refloat had better go well, otherwise, the private equity groups bringing Kathmandu Holdings to market might have a dud on their hands.
The Myer issue closed at 5 pm this Friday, as a series of newspaper ads reminded us yesterday.
There are media reports that the groups third quarter sales weren’t good and won’t be made public before the shares list and management are winding up a roadshow to the US ahead of the issue closing.
Myer shares are expected to start trading on Monday November 2 on a deferred basis and normally nine days later.
That will prime the ground for the Kathmandu float and listing for the shares on both the ASX and its New Zealand counterpart.
The company is offering up to 197.4 million shares to investors representing 99% of the issued capital. (There’s a minimum of 166.9 million shares to be sold).
The retail offer, conducted in Australia and New Zealand involves the Kathmandu employee offer, (open to eligible employees); and the broker firm offer, open to investors in Australia and New Zealand who have received a firm allocation from their broker.
There will be no general public offer, meaning that the ordinary punter who couldn’t get set, will have to chase the shares on market once they list.
And if the Myer issue is a stunning success, it will encourage interest in Kathmandu shares.
The indicative price range for the offer per share was $A1.65 to A$1.90 and in New Zealand at $NZ2.01 to $NZ2.32.
The gross proceeds from the offer were expected to be in the range of $A278 million to $A375 million and in New Zealand between $NZ338 million and $NZ457 million.
The offer would open on October 27 (four days after the Myer issue closes) and close on November 6, before being listed on the NZ Exchange and ASX Exchange a week after Myer begins trading normally on November 18.
Kathmandu was founded in Christchurch in the 1987 by Jan Cameron, who sold the company to existing owners Goldman Sachs JBWere and Australia’s Quadrant Private Equity in 2006 for an unknown total; although the first 51% was sold for $234 million.
It has 85 stores spread throughout Australia, New Zealand and six in the United Kingdom.
Media report said yesterday that the private equity owners of the company may sell all their holding after the float.
The money raised from the public offer will be used to acquire all the shares in Milford Group Holdings which currently owns the Kathmandu business, and reduce existing debt.
The current private equity owners are Goldman Sachs JBWere Principal Investment Area and Quadrant Private Equity. Kathmandu management aims to own approximately 1.3% of the group.
Sales have increased from $133 million in 2006-07 to $176 million in 2008-09, and the document says Kathmandu is forecasting financial 2009-10 sales of $197 million and 2010-11 EBITDA of $47 million, representing an increase of 11% on 2009 sales and 15% on FY2009 EBITDA.
Newly appointed Kathmandu chairman James Strong said the company had undergone a transformation over the past three and a half years; with significant investment in new stores, IT systems, distribution centres and its people, and a dual stock exchange listing was the logical next step for the Kathmandu’s growth plans.
“We believe a dual listing will provide Kathmandu with growth flexibility, and give investors the opportunity to own shares in a very well recognised retail brand which resonates with customers’ aspirations of travel and adventure.”
