November 2, 2016 / 6:45 AM / 3 years ago

UPDATE 1-Australia's Inghams IPO scaled back after TPG counted chickens too early

* Revised terms come less than a month after first prospectus

* REIT offering from Charter Hall also had to be re-priced

* Inghams IPO now aims to raise around $455 mln (Recasts throughout with details from the prospectus)

By Jamie Freed and Byron Kaye

SYDNEY, Nov 2 (Reuters) - TPG Capital Management LP has slashed the amount it plans to raise in a listing of Australia’s biggest chicken producer, the second domestic offering in as many months to be re-priced as investor enthusiasm for IPOs wanes.

In documents revised less than a month after the prospectus was issued, the U.S. private equity giant said an initial public offering for Inghams Group Ltd now aimed to raise A$596.4 million ($455 million), much less than the original target of up to A$1.1 billion.

An adviser to TPG, who declined to be identified, said the downsizing was motivated by the desire to ensure a strong first day of trading. A successful debut is seen as key as TPG will also be courting investors this year with an IPO for Australian gas and electricity supplier Alinta Energy worth up to A$3 billion.

TPG declined to comment beyond the prospectus.

But the downsizing also underscores the caution which has been holding back IPO markets around the world as investors fret about the outcome of the U.S. presidential election and Britain’s vote to leave the European Union.

“The U.S. election will have a big impact. That will impact investor confidence,” said Ian Turner, Deloitte’s head of corporate finance in Australia.

Last month, property group Charter Hall Group pulled a A$1.1 billion REIT offering after failing to draw support from institutional investors although it later reapplied to list at a lower price.

Under the new terms, TPG slashed the amount of the company it was taking public to 40 percent from a target of up to 70 percent outlined previously, and cut the issue price to A$3.15 from a target range of A$3.57 to A$4.14.

The number of new shares in the offering was, however, bumped up although that portion of deal is still much smaller than the amount of shares sold by TPG.

Inghams is pitching itself as a beneficiary of changing tastes in its home market, where chicken consumption overtook beef a decade ago and is now double it. The company expects to post a pro forma net profit of A$98.8 million in fiscal 2017, up a fifth on the previous year.

In Australia, money raised in IPOs has fallen to $3.1 billion from $4.39 billion at the same time last year, according to Thomson Reuters data, and offerings led by private equity firms have been greeted with some caution.

In July, Dick Smith Electronics, sold in an IPO by another private equity firm in 2013, entered administration. Shares of hospital operator Healthscope Ltd, which TPG and private equity rival Carlyle Group listed in mid-2014, were trading at a 3 percent premium to their issue price on Wednesday.

Inghams shares are expected to start trading on Nov. 7. ($1 = 1.3111 Australian dollars) (Reporting by Jamie Freed and Byron Kaye; Editing by Edwina Gibbs)

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