Gloomy global economy downgrades non-bank's IPO

by Julia Corderoy15 Jul 2015
Major non-bank lender, Pepper has had to discount its valuing of the company in an initial public offering amid global concerns, the Australian Financial Review has reported.

According to the report, it is understood that the deal has been listed at a valuation of 10 times the calendar year 2015 net profit after tax, which equates to a price of $2.60. This is down from the 12 times earnings Pepper hoped for. 

The discounted deal came after Greek Prime Minister Alexis Tsipras agreed to a list of austerity concessions in exchange for a bailout package. The AFR has also reported that Pepper's management and founders are not selling into the float and will account for around 45% of the register after the listing.

Last month, Australian Broker published reports that Pepper began distributing pre-marketing research to fund managers, in a bid to raise money on the ASX. 

At the time, it was understood that the non-bank would be valued at about 13 to 14 times net profit, or $611 million to $658 million. Pepper is forecasting net profit growth of 34% to $47 million in the calendar year 2015, while revenue is expected to hit $300 million, from $230 million in 2014.
 

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