Wagners’ IPO hype mounts
THE WAGNER family will retain a controlling stake in its namesake company if it lists on the Australian Securities Exchange.
Wagners Group chairman Denis Wagner yesterday spoke to The Chronicle from Sydney after The Australian reported that analysts had begun marketing their research into the company for prospective equity investors.
Mr Wagner would not confirm reports that the company was preparing to list on the ASX before Christmas, saying only: “We are looking at a number of options for a capital structure and a listing is one of those.”
“We’re going through a process and we’ll have more clarity over the next couple of weeks.”
The Australian reported the family “plans to keep a significant amount of skin in the game, holding on to about 50 per cent.”
But Mr Wagner said that if an initial public offering were to eventuate, that figure would be even higher.
“If we proceed to a listing, our intention would be to retain up to 60 per cent of the company,” he said.
A Wagners IPO has long been the subject of speculation and the latest reports suggest hype among analysts who are said to be “upbeat” about the business as they look favourably on the family’s continued involvement in the company.
According to The Australian, analysts from Credit Suisse on Monday predicted Wagners would float at between $353 million and $437m. Morgans had the range at $472m to $513m, equating to between 20 and 22 times its forecasted net profit. The pricing range equates to between 14.7 and 18.2 times its forecast annual net profit.
Wagners’ major asset is its cement terminal at the Pinkenba industrial precinct at the Port of Brisbane, which can process up to 800,000 tonnes of cement a year.
Credit Suisse analysts are also optimistic Wagners will capitalise on southeast Queensland’s population boom. Around $13 billion is expected to be spent between now and 2021 on the region’s infrastructure, and with Wagners dominating the cement market, the analysts reportedly predict the family-run business will win about $180m of revenue from the work annually.
Finally, The Australian said “one of the points of focus for Wagners has been a long-term take-or-pay agreement with Boral. The group signed a 20-year contract with Boral in 2011 that accounts for 45 per cent of its annual fiscal 2017 cement production volume.”