INGHAM'S CHICKEN FLOAT FALLS FLAT

Written on the 7 November 2016 by Lin Evlin

INGHAM'S CHICKEN FLOAT FALLS FLAT

INGHAM'S debut on the Australians Securities Exchange failed to enthuse investors today

The company's shares began trading at 11 am AEST time at the revised price of $3.15. Amid a generally weak appetite by the market for initial public offerings (IPO) from larger cap companies, shares in Ingham fell by one cent at 11.15 am before climbing by two cents to $3.16 at 2 pm AEST. 

This follows the unusual step by its previous owner, private equity firm TPG Capital Management, of re-pricing Ingham's share price last Friday from the indicative price range of $3.57-$4.14 to $3.15.

Ingham's had initially set out to raise between $768 million and $1.12 billion with a market capitalisation of around $1.3 billion to $1.5 billion. Instead, it is now aiming to raise $596 million and deliver a market capitalisation of $1.19 billion.

Ingham's Group (ASX: ING) is the dominant poultry brand in Australia with a market share of around 40 per cent. Its next biggest competitor is Baiada, which holds a 33 per cent estimated market share based on on FY16 sales.

TPG, which bought Ingham's from original founder Bob Ingham in 2013, entered the IPO with 90.1 per cent ownership of the company. It will retain 47 per cent of the company, instead of the 24 to 40 per cent range indicated earlier.

Ingham's is not the only large IPO to encounter issues in recent times as Bravura Solutions and Charter Hall Long WALE REIT have also repriced or restructured their listings.

 
Author: Lin Evlin Connect via: Twitter LinkedIn

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