Sydney, Australia — The largest sharemarket float since the global financial crisis — that of the country’s online car classifieds leader, Carsales.com.au — is set to be launched to the public today in an initial public offering that values the company at $812 million.
It is understood that Carsales will be launched to the public at $3.50 a share, towards the top end of a $3.24-$3.56 indicative range issued by the company to institutions last week.
Today’s launch follows a successful “pre-marketing” stage for the float with institutions last week — which culminated in a bookbuild process that saw the shares rise to $3.50.
At $3.50 each, Carsales shares will trade at an earnings before interest, tax, depreciation and amortisation (EBITDA) multiple of 14.5 and a bottom line net earnings multiple of 21.8. It is understood that the company has forecast that its bottom line net profit for the 2009-10 financial year would be $37.1m, up about 20.8 per cent on the record $30.7m profit it disclosed for the year just passed.
The predicted result was even stronger for 2009-10 on an operating basis.
It is understood that the company is forecasting a $56.6m EBITDA for 2009-10, up 29.5 per cent on the $43.7m figure it reported in 2008-09.
It is believed that the company is making available between 20 per cent and 25 per cent of its shares through today’s prospectus.
The bulk of this stock will be placed with institutions, with a small amount also to be made available for a retail component.
The float will be largely a compliance listing to allow many of Carsales’ existing 500 or so shareholders a vehicle through which to crystallise the value of their stakes.
One stakeholder that is definitely not selling any of its shares is the debt-laden Nine Network owner PBL Media, a 49.5 per cent shareholder.
The 10 largest investors in the group after PBL Media, which collectively own 36 per cent or so of the group, will sell about half of their stakes, or up to 18 per cent.
Those halving their holdings include Carsales chairman and second-largest shareholder Wal Pisciotta, who has 16 per cent of the company.
Carsales chief executive Greg Roebuck, with 4.5 per cent, will be an exception, selling less than half of his stake, because of the view that the chief executive should be seen to be a holder of stock.
Many of the current shareholders are car dealers who paid about 20c a share for stock when the company was set up around the time of the dotcom boom and bust in 2000.
A successful launch of Carsales is likely to spark attempts by other companies to capitalise on the rising market of recent months by launching their own initial public offerings.
Carsales is set to become one of the market darlings of the media sector, given its consistent ability in recent years to record large year-on-year rises in operating and bottom line profit in a market that is not yet fully mature.
By Nick Tabakoff
August 17, 2009
source: theaustralian.news.com.au