Australian Gaming & Entertainment plans to raise $80 million in an initial public offering and has embarked on a five-city roadshow today to entice investors in Australia and Asia to buy shares in the future operator of gaming-centric pubs in Sydney, according to an email sent to Data Room.
CIMB and Wilson HTM are joint lead managers of the IPO that seeks to sell 80 million shares at $1 each. The offer price of the IPO is 12.6 times the company’s forecast 2015 net profit per share.
The proceeds of the share sale, together with a $43m debt facility, will be used to initially acquire five pubs in Sydney’s western and southwestern suburbs. The portfolio is being acquired at a weighted average capitalization rate of 10.5 per cent, a premium of about 6 per cent to the Australian 10-year bond rate.
About 70 per cent of Australian Gaming & Entertainment’s revenue is forecast to come from poker machines and the company hopes to acquire other similar pubs that are currently priced at $14m to $20m each.
Today, Australian Gaming management are meeting investors in Brisbane and later this week will be in Sydney and Melbourne. On Monday next week, company management will be in Hong Kong and the next day are scheduled to visit Singapore.
The book build begins May 8. The shares are expected to begin trading on the ASX on June 3.
CIMB and Wilson HTM are expected to garner fees of $3m from managing the IPO.
(Editing by firstname.lastname@example.org)