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VNT - Ventia Services Group

Dona Ferentes

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Ventia Services’ initial public offering had been considerably downsized and re-priced to ensure it hit the ASX boards as scheduled this week.

Ventia’s owners, ASX listed CIMIC and private equity firm Apollo Global Management, saw the company raise $438 million and its two big shareholders retain almost all of their shares at the float.

The IPO is at $1.70 a share and values the group at $1.5 billion on a market capitalisation basis or 8.5 times forecast net profit after tax and amortisation for the 2022 calendar year. It would imply an 8.9 per cent dividend yield.

Listing date19 November 2021 ; 1:00 PM AEDT ##
Company contact detailshttps://www.ventia.com/
Principal ActivitiesVentia is one of the largest essential services providers in Australia and New Zealand. Ventia was created in 2015 following the merger of Leighton Contractors Services division, Thiess Services and Visionstream. In 2020, Ventia acquired Broadspectrum (formerly Transfield Services).
GICS industry groupTBA
Issue PriceAUD 1.70
Issue TypeOrdinary Fully Paid Shares
Security codeVNT
Capital to be Raised$438,000,000
Expected offer close date10 November 2021
UnderwriterNot underwritten. Barrenjoey Advisory Pty Limited, J.P. Morgan Securities Australia Limited and Macquarie Capital (Australia) Limited (Joint Lead Managers)
 
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Cimic and Apollo's 70% ( ?) shareholding will be in escrow for the next 15 months at least, so there's not much free stock out in the market.
 

Dona Ferentes

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Opened strongly at $2.08 and is currently $2.11
given the repricing of this IPO to get it away, there is a remarkable consistency in pricing in the 4 days on market ... trading in a range of just a few cents, from $2.08 to $2.14.

The *indicative pricing* was $2.75 to $3.15, the IPO got away at $1.70.

CIMIC and US private equity firm Apollo Global Management – which previously each held 47 per cent – had intended to sell most of their holdings and retain only 22.3 per cent each. CIMIC and Apollo ended up retaining bigger stakes than forecast – 280 million shares each, or equal stakes of 32.8 per cent. (= 65.6%). At least having > 30% free float means the stock is eligible for index inclusion.

Institutions were nervous about the amount of stock CIMIC and Apollo were trying to offload, while others were reluctant to invest in a contracting business (which can report hefty write-downs when contracts go wrong.) Other investors were wary of buying shares in an entity partially owned by CIMIC which has a poor record on transparency (that's a euphemism).
 
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Good evening
Company share price record achieved today (02/01/24) @ $3.185.

Nice.

Some major shareholder changes ... sick of reading about it in announcements.
Did like the part about Ventia awarded a one-year Field Optimisation contract extension with Telstra Corporation Ltd (ASX:TLS). The Agreement (06/12/23) is expected to deliver revenue of up to approximately $340 million to Ventia over the next 12 months.

Just a glancing homework session, but rcw1 liked what the glance picked up - on watchlist.
*** Not much written on this one since 24/11/21: has anybody got anything on this stock as find it difficult to believe has gone through to the keeper!!!

Sarah Thompson, Kanika Sood and Emma Rapaport
Nov 2, 2023 – 4.50pm AFR
Ventia Services Group’s IPO vendors Apollo and CIMIC flushed out the last morsels of their stake in the business on Thursday evening, calling in Barrenjoey and JPMorgan to launch a $270 million block trade.
Ventia maintains all kinds of infrastructure, including water treatment plants.
The broker duo began rounding up investors at $2.71 per share – a 1.5 per cent discount to the last traded price of $2.75, according to a term sheet seen by Street Talk. The book was covered late on Thursday afternoon.
Fund managers were offered approximately 99.8 million shares in Ventia, representing 11.7 per cent of the company. They sucked up the stock, knowing it was the last lot from the IPO vendors.
It has taken Apollo and CIMIC nearly two years and four block trades to get their money out. But they have done well out of the wait – each of those selldowns was done at a much higher price than the $1.70 that Ventia shares fetched during the IPO bookbuild.
Readers will recall Ventia’s IPO was recut in late 2021 to get the deal away as the red-hot IPO market began to cool. The original plan was for Apollo and CIMIC to retain a combined 44.6 per cent at listing, via a $1 billion to $1.2 billion IPO raise at $2.75 to $3.15 a share. The float ended up being repriced to $1.70 a share, with Apollo and CIMIC retaining a combined 65 per cent of Ventia to a February 2023 escrow.
The block trades – all handled by Barrenjoey and JPMorgan – were done at $2.15, $2.42, $2.65 and finally $2.71. In line with the IPO vendors, investors who tipped in for the float have also done well out of the company with Ventia shares up nearly 31 per cent since the listing in November 2021.


3 minute chart
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Dona Ferentes

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The original plan was for Apollo and CIMIC to retain a combined 44.6 per cent at listing, via a $1 billion to $1.2 billion IPO raise at $2.75 to $3.15 a share
... and look where they are now.... exactly $3.15.

just took 2 years and a frothy market.
 
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