(Corrects price paid by PEP for Spotless in third graf)
* Spotless puts offer price at A$1.60-A$1.85 a share
* PEP to retain 49 percent of company
* Spotless eyes A$1.5 bln of new contract opportunities
SYDNEY, April 28 Australian facilities
management company Spotless Group plans to raise as much as A$1
billion ($928.15 million) in the country's biggest initial
public offering so far this year.
Spotless is offering 540.5 million new and existing shares
at A$1.60 to A$1.85 each, partly to repay debt, the company said
The planned share sale comes less than two years after
Australia's biggest private equity firm Pacific Equity Partners
(PEP) acquired the group for A$730 million. PEP will retain 49
percent of the business after the IPO.
The sale will give Spotless a market value of A$1.76 billion
to A$1.93 billion.
The quality of earnings and margins had improved under
private management, Spotless Chairman Margaret Jackson said, as
the company exited loss-making and marginal contracts to focus
on higher margin contracts.
Jackson also said the catering, cleaning and laundry group
was benefiting from a trend towards outsourcing in the industry
as it continued a restructure started when PEP took control of
the business in August 2012.
"The business has identified potential new contract
opportunities representing approximately A$1.5 billion in annual
revenue coming to market by the end of full year 2015, with
further significant new opportunities in adjacent services and
sectors," Jackson said in a statement.
Investment banks Citi, UBS and Deutsche were the joint lead
managers for the IPO. The back-end bookbuild is scheduled to
take place on May 20-21, which will set the price for the IPO.
The final price is due to be announced on May 22 with the
listing scheduled for May 28.
The proposed IPO surpasses the A$450 million raised by
Japara Healthcare Ltd earlier this month.
($1 = 1.0774 Australian Dollars)
(Reporting By Jane Wardell; Editing by Ryan Woo)