* Japara to raise up to A$450.4 mln in biggest IPO of the
year so far
* Offers up to 225.2 shares at A$2.00 each, valuing company
at A$525 mln
* Tests IPO appetite before Medibank's A$4 bln IPO and after
3 aborted deals
(Adds offer details, company comment, fund manager comment, IPO
SYDNEY, April 4 Australia's Japara Healthcare
plans to raise over $400 million in an initial public offering
(IPO) that could test investor appetite for the healthcare
sector ahead of multi-billion dollar deals.
Japara, which runs 35 care centres for the aged, could be
embarking on the country's biggest IPO so far this year before
the possible sale of shares in state-owned insurer Medibank
Private and private hospital operator Healthscope.
The company's announcement, however, comes at a time of
uncertainty in Australia's IPO market after three deals were
recently aborted, ending a year of IPO fever when many shares
were priced too high.
A five-year IPO drought finished in 2013 with a six-fold
on-year increase in the value of share sales, while the stock
index built on a 2012 recovery with a 15 percent rise. Yet the
shares of several IPOs have languished below their sale prices.
Japara plans to raise as much as A$450.4 million ($415.79
million) by selling up to 225.2 million shares at an indicative
price of A$2.00 each, giving the company a market capitalisation
of A$525 million, showed its IPO prospectus released on Friday.
Macquarie Group was the lead manager of an IPO fully
underwritten after attracting cornerstone investors, Japara
said. The shares are due to start trading on April 17.
The company in the prospectus said it aims to increase its
number of beds to 5,000 from 3,131 by buying facilities and
through new developments.
"Australia's population is ageing and the demand for
services within the residential aged care sector continues to
grow," Chief Executive Andrew Sudholz said in a statement. "At
Japara, we are well placed to meet this growing need."
Australians aged 65 or over make up about 14 percent of the
population, or 3.22 million people, and that figure is likely to
reach 25 percent over the next 30 years, showed data from the
Australian Bureau of Statistics.
Consideration of demographics alone could draw interest for
Japara's IPO, said Don Williams, chief investment officer at
Platypus Asset Management.
"It's a good business," Williams said. "I think the interest
will be reasonably strong because it's a market that's growing."
Japara's IPO could indicate appetite toward listings in
general and healthcare listings in particular, before Medibank's
estimated A$4 billion flotation and possible sale of Healthscope
by TPG Capital and The Carlyle Group (CG.O), which analysts put
at A$5 billion.
The government announced the sale of Medibank about the same
time No.2 hotelier Mantra Hotels pulled the plug on its A$400
million IPO after investors complained of high pricing. Similar
fates befell retailer OzSale and Stirling Early Education.
"I think the pricing of IPOs seem to be a lot more difficult
than it normally is," Williams said. "There are still a lot of
jittery investors out there basically."
($1 = 1.0832 Australian Dollars)
(Reporting by Byron Kaye and Maggie Lu Yueyang; Editing by