Australia's Pacific Equity sells down Veda, books $227 mln profit

SYDNEY Thu Aug 28, 2014 1:45am EDT

SYDNEY Aug 28 (Reuters) - Australia's largest buyout firm Pacific Equity Partners said it had sold down its stake in newly-listed credit rating company Veda Group Ltd, making a A$243 million ($227.42 million) profit on share gains over eight months.

PEP in December sold a third of Veda in an initial public offer and said it would keep the rest at least until the company reported its first annual results.

Veda reported its earnings for the year ended June 30 on Wednesday. The company beat the annual net profit forecast in its prospectus by 8 percent.

After the earnings announcement, PEP Managing Director Tony Duthie wrote to Veda saying his firm had sold 32 percent of its shares in a block trade to an undisclosed buyer, and that it would keep the remaining 31 percent.

Veda released a copy of the letter at the start of trading on Thursday and said PEP had sold the shares earlier in the day. PEP sold the stake for A$2.15 per share, or A$580 million, Veda said in a statement to the Australian Securities Exchange.

The stake was worth A$336.8 million before the December listing, based on its issue price.

Veda's shares jumped 6.3 percent to close at A$2.20 on Wednesday, before PEP sold its stake, nearly double their A$1.25 issue price. On Thursday the shares closed steady.

PEP is taking advantage of high share prices and strong global interest in Australian businesses as it exits a host of investments in 2014.

In May, it sold half of cleaner-caterer Spotless Group Ltd in a A$954 million listing and ice-cream maker Peters Food Group Ltd to Britain's R&R Ice Cream PLC for a reported A$450 million.

In July, PEP sold New Zealand snack company Griffin's Foods Ltd to Philippine snack and beverage maker Universal Robina Corp for NZ$700 million ($609 million).

(1 US dollar = 1.0685 Australian dollar) (Reporting by Byron Kaye; Editing by Ryan Woo)

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