Market turmoil hits Irish IPO plans
Turmoil across financial markets served to put the spanner in the works for a number of Irish companies that had ambitions of floating on the stock market in 2018.
In early March, Core Industrial Reit, a fledgling logistics and industrial real-estate trust, decided to pull its planned €225 million initial public offering (IPO), citing “market conditions”. It was being lined up as the sixth property-related company to join the Irish Stock Exchange in five years, initially holding almost €83 million of industrial units that US hedge fund York Capital had acquired on the cheap in Ireland in recent times.
In early October, it emerged that Paddy McKillen jnr’s Press-Up Entertainment, the State’s largest and fastest-growing pub and restaurant group, had decided to mothball its plans for a flotation and had decided to fund its near-term growth ambitions from its own resources.
The company subsequently joined up with a unit of the Rockefeller Group and Dublin-based Core Capital to buy and redevelop the former Clerys department store in Dublin in a deal worth about €63 million.
As equity market volatility continued unabated in October, California-based private equity group Oaktree and Dublin-based Sigma Retail Partners decided to push out a decision on whether to proceed with a retail Reit until 2019.
Oaktree affiliate Targeted Investment Opportunities’ (TIO) purchase of a controlling stake in the Square shopping centre in Tallaght in Dublin from the National Asset Management Agency in February had provided the potential Reit with a “cornerstone” asset. Early November saw property investment and hospitality group Tetrarch, whose assets include the 764-bedroom Citywest Hotel in Saggart, Co Dublin and stakes in the Mount Juliet hotel and golf resort in Co Kilkenny, Powerscourt hotel in Co Wicklow, and Kilashee hotel in Co Kildare, shelve plans for a 2018 IPO, which had been expected to raise between €200 million and €300 million. Days later, it became clear that US private equity group Lone Star had put its plans for a €300 million-plus IPO of an Irish housebuilder on hold. The company, called DRes, set up in partnership with Durkan Residential’s managing director, Patrick Durkan, is understood to control a land bank capable of delivering 6,400 houses and apartments.
T5 Oil & Gas, an African-focused exploration company set up by a group of Tullow Oil veterans, also decided last month to postpone a London flotation as oil prices dived. It is understood that the company, led by executive chairman Pat Plunkett, who chaired Tullow Oil between 2000 and 2011, is considering a back-up plan of selling a stake in itself to a strategic investor.
Meanwhile, former Ryanair finance chief (above) Howard Millar’s new aircraft leasing business, Sirius Aircraft Leasing Fund, decided at the start of this month to hold off on its London IPO until early in 2019, saying that some of the “significant investors” that it has lined up were unable to pay up on time for a planned transaction in early December. Sirius aims to raise $250 million (€220million) before floating to go about buying second-hand plans and lease them on to airlines. However, some Irish-related flotations did manage to get over the line. IPL Plastics, formerly One51, raised 178 million Canadian dollars in an IPO and flotation on the Toronto Stock Exchange in June. However, its market value has subsequently fallen by about a third. The same month, a new Irish real-estate investment trust, Yew Grove Reit, raised €75 million before listing on the Dublin exchange.Its shares are currently trading in line with their €1 IPO price.
Alan Walsh, chief executive of IPL Plastics.