TPG-owned Ingham's targets up to $843m in Australia IPO

The company will sell 214.7-270.8 million shares at A$3.57-4.14 apiece, according to a prospectus. Based on the mid-point of these size and pricing ranges, TPG will sell 199.4 million shares - or 60% of its overall holding - and receive proceeds of A$769.1 million. Its remaining 31.9% interest would be worth around A$459 million, although this would be subject to a lock-up period.

The offering will give Ingham's an enterprise valuation of as much as A$1.53 billion, including A$418.2 million in debt, which equates to 10.3x forward EBITDA.

TPG bought the company after a protracted bidding war in 2012 that saw The Blackstone Group offer around A$1.1 billion before lowering its price on finding few groups were still in pursuit of the asset. Ingham's suspended the process until early 2013 when TPG won out. It paid A$850 million in cash - plus a A$30 million vendor note - and obtained A$625 million in debt financing at a valuation of 4.8x EBITDA.

The private equity firm is understood to have already taken some capital out of Ingham's, following the sale of a portfolio of real estate assets in 2014 and conversion of those properties to leaseback.

Founded in 1918, Ingham's was family-owned until its sale to TPG. The company is the largest vertically integrated poultry producer in Australia and ranks number two in New Zealand, with estimated market shares of 40% and 34%, respectively. It has 345 facilities and farms across both countries, most of them owned and operated by third parties. Ingham's also supplies various poultry, dairy, horse and pig feeds.

Pro forma revenue came to A$2.31 billion in the 2016 financial year, up from A$2.27 billion 12 months earlier. Over the same period, EBITDA increased from A$114.5 million to A$167.5 million while net profit went from A$51.7 million to A$83.1 million.

The Ingham's IPO follows an offering by Tegel Group Holdings, the market-leading poultry producer in New Zealand, earlier this year. The company raised NZ$398 million ($205 million), facilitating a partial exit for private equity owner Affinity Equity Partners.

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• Topics
• Australasia
• Consumer
• IPO
• TPG Capital
• Australia
• Exit