* IPO values firm at 9.7 bln rand
* IPO priced in the middle of planned range
* Buyout investors exiting at top of the market
(Adds analysts' comments)
By Tiisetso Motsoeneng
JOHANNESBURG, July 18 South African pension
manager Alexander Forbes priced its stock market listing in the
middle of its marketed range on Friday, raising 3.7 billion rand
($347.32 million) in Africa's second-largest initial public
offering this year.
The pricing points to fairly strong demand when the company
lists on the Johannesburg bourse next Thursday, a trader said.
It values Alexander Forbes at 9.7 billion rand ($908 million)
and allows a group of investors led by buyout firm Actis to exit
the company at the top of the market.
London-based Actis and other private equity investors took
the pension fund manager private in a 8.2 billion rand deal in
2007, just before the global financial crisis. Since then, South
African stocks have recovered to post record highs this year.
"It is probably fair to say there's no better time like the
present to launch an IPO. The top of the equity market is what
you're looking for. That would be the exit point," Sasha
Naryshkine, a fund manager at Vestact, a Johannesburg-based
asset manager, said.
It will be Africa's biggest IPO since Nigerian oil and gas
company Seplat raised $540 mln in a London
and Lagos listing in April.
Alexander Forbes, which also offers life insurance and
financial planning, said it sold 496.7 million shares, including
44 million new shares issued to bolster its capital position, at
7.5 rand each, raising 3.7 billion rand.
The offer was priced in the middle of an indicated range of
6.9 to 8.05 rand.
"The demand is going to be pretty strong because there are
few life players in the market and Alexander Forbes is a quality
alternative," said Evan Giannakis, a trader at Imara SP Reid.
The total sale represents 38 percent of the company that was
founded more than 75 years ago.
Alexander Forbes' closest competitors for investors on the
Johannesburg stock market will be health insurer Discovery
Holdings and life insurer Old Mutual.
Shortly after the listing next week, Marsh & McLennan
, the world's top insurance broker, is due to become
Alexander Forbes' biggest shareholder with a 34 percent stake.
Marsh is due to buy the stake in two tranches at a price
linked to the IPO, starting with 14.9 percent when Alexander
Forbes' lists and the rest shortly after.
After the 2007 buyout, about a third of the firm remained
listed in a special entity called Alexander Forbes Preference
Share Investments to house the holdings of some
investors who did not want to sell.
Alexander Forbes said that stake, which is worth about 2.7
billion rand, would be spun off to existing shareholders, which
include fund managers Allan Gray and Stanlib.
Shares in the special purpose entity rallied 6.02 percent to
8.80 rand by 1311 GMT on Friday, outpacing a 0.6 percent decline
on the JSE All-share index.
Deutsche Bank AG, Morgan Stanley and
FirstRand unit Rand Merchant Bank were the joint
bookrunners on the sale.
($1 = 10.6531 South African rand)
(Additional reporting by David Dolan; Editing by Susan Fenton)