The stalled initial public offering market has shown signs of life after Virtus Health was priced at the top of the range, raising $339 million in the biggest private equity float since KFC franchisor Collins Foods in 2011.
After strong demand from investors, lead managers UBS and Morgan Stanley yesterday priced Virtus at the top of the $4.92-$5.68 range.
Fund managers were being told of their allocations last night, with the demand seeing Quadrant Private Equity sell down its entire 46.5 per cent stake in the country's biggest provider of IVF services.
The company's doctor-owners had reduced their ownership, but would own 22.7 per cent of Virtus when it hit the boards next month with a market value of about $450m, sources said.
Focus will turn to Virtus's debut and after-market performance after some troubled floats out of private equity in recent years, including TPG's float of department store giant Myer, which is yet to trade above its $4.10 issue price.
Collins Foods, floated by Australia's largest private equity firm, Pacific Equity Partners, issued a profit warning within months of listing and yesterday ended at $1.71 a share compared with its IPO price of $2.50. Mining services firm Calibre Group, floated last year by First Reserve at $1.63, was last swapping hands at 33.5c.
But recent larger successful floats of New Zealand companies Fonterra, Trade Me and Mighty River Power -- which are dual listed on the ASX -- has given bankers hope.
