Spotless road show, book build, listing set for May

A Spotless prospectus is expected to be issued by the end of this month followed by an international road show and a book build.

The international road show, book build and listing of Spotless on the ASX will take place next month, reporting by Data Room has discovered. A Spotless initial public offering is expected to raise at least $1 billion.

Today, the joint lead managers of the outsourced facilities management and services company, Citigroup, Deutsche Bank and UBS, are sending their Spotless analysis to fund managers before a prospectus is issued at the end of this month. Citigroup estimates Spotless’ enterprise value at $2.7bn to $2.9bn following chief executive Bruce Dixon’s cost cutting, devolved decision making and streamlined practices.

The Spotless two-day book build next month is expected to be conventional and come after a two-week road show. The book build will not include a so-called cornerstone process where selected investors are asked for commitments ahead of the book build.

The IPO’s joint lead managers will solicit orders from fund managers, price the IPO and then allocate stock to investors. An ASX listing after the book build would then happen almost immediately. 

Pacific Equity Partners bought Spotless less than two years for an enterprise value of $1.1bn. The boutique equity capital markets and takeover adviser Highbury Partnership is advising the Spotless board on the IPO. Pacific Equity will retain a 50 per cent Spotless stake in a company after the IPO with a market value forecast to be $2bn.

In the 12 months to June 30, 2014, Citigroup estimates Spotless’ earnings before interest, tax, depreciation and amortisation at $249 million and revenue at $2.5bn. Spotless employs about 33,000 people.

In the 12 months to June 30, 2015, Citigroup expects Spotless’ EBITDA to increase to $305m and sales to rise to $2.7bn.

So far this year there have been 11 IPOs that have been priced with two trading, according to Bloomberg data. In the same period last year 13 IPOs had been priced and nine were trading, says Bloomberg.

(Reporting by Brett.Cole@businessspectator.com.au)

(Editing by Miranda.Maxwell@businessspectator.com.au)

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