Shares in chicken producer Tegel will be listed on the NZX and Australia’s ASX on May 3, with the deal likely to raise around $300 million.
It is expected that more than $130 million of the cash raised will be used to repay bank debt, while up to $163 million would go to holders of Tegel’s redeemable shares.
The remaining millions of dollars will cover the IPO costs, including a bonus for senior management.
A broker firm offer to retail clients of selected NZX firms will open on April 20 and close on April 29. The deal is being managed by Deutsche Bank, Craigs, Goldman Sachs and First NZ Capital.
Tegel’s majority owner Affinity Equity Partners will sell down around 30% of its existing 87% stake to retain about 45% of shares in the company following the deal. Affinity won’t be able to further sell down its stake until the release of 2017 full-year financial results.
The deal gives the poultry producer an implied enterprise value of $672 million to $756 million and an implied market capitalisation of $552 million to $636 million. Affinity purchased the business in 2011 for $605 million from Australia’s Pacific Equity Partners.
Tegel has operations in Auckland, Christchurch and New Plymouth and around 2000 staff. The company expects poultry sale volumes to rise to more than 92,000 tonnes by 2017, of which more than 16,000 tonnes will be exports.
In a letter to investors, Chairman James Ogden said Tegel plans to focus on new product developments to increase the value and volume of poultry sold, expand value-added production, develop new sales channels, and enter new export markets.