Summerset reaches $123.6 mln target in largest NZ IPO in two years

Thursday 27th October 2011

Summerset Group, the retirement village operator controlled by Quadrant Private Equity, raised the $123.6 million targeted in the largest New Zealand initial public offering in two years.

The shares are set to debut on the NZX on Nov. 1 after the company sold 88.3 million shares at $1.40 apiece, giving it a market capitalisation of about $300 million. The sale price was at the bottom end of the indicative range.

Quadrant retains 56 percent of Summerset, the nation’s third-largest retirement village operator with 13 villages.

The sale is the largest New Zealand IPO since outdoor equipment chain Kathmandu Holdings in 2009, also a Quadrant float, which raised A$375 million in Australia and New Zealand.

The private equity firm completed the acquisition of Summerset last year when the Overseas Investment Office signed off on the deal, buying the 50% it didn’t own from fund manager AMP Capital Investors New Zealand.

AMP Capital sold up after failing to get the retirement village operator away in a public float in 2007. Quadrant came on board in 2008, investing A$90.5 million of an A$500 million private equity fund.

Craigs Investment Partners, Deutsche Bank and First NZ Capital were joint book-runners, joint lead managers and joint organising participants for the IPO. Forsyth Barr was also appointed a joint lead manager.

Summerset is forecasting pro forma net operating cash flow of $51.9 million and total investment properties worth $632.6 million in the financial year ending Dec. 31, 2012. It expects underlying profit after tax of $6 million this financial year, rising to $9.7 million in 2012.

BusinessDesk.co.nz

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