Rhodes Food raises R1.2bn ahead of IPO
IOL Business - Sep 30th 2014, 10:13
Johannesburg - Rhodes Food Group raised R1.2 billion in an initial public offering (IPO) priced in the middle of an earlier indicative range, it said on Friday.
At that price, the IPO would give the maker of frozen food and prepared meals a market capitalisation of 2.6 billion rand when it lists next Thursday.
Rhodes supplies major retailers such as Woolworths, Pick n Pay and Shoprite with jams, pastries, and sausage rolls and sells canned citrus in Britain.
It competes with Tiger Brands and Pioneer Food Group.
The company reported a more than one-third rise to 1.8 billion rand in revenue in the nine months to end-June, while core profit, or EBITDA, increased by the same margin to 195 million rand.
Rhodes, which had set the IPO price in a range of 10.50 rand and 13.50 rand, sold 102 million shares million at 12 rand each, raising 1.2 billion rand.
The IPO included a follow on offer, or overallotment option for underwriters, of about 9 million shares, aimed at stabilising the price and preventing it from going below the offer price.
The offer comprised of 50 million shares issued by the company to raise 600 million rand to pay down debt and another 43 million shares from shareholders cashing out.
Morgan Stanley, FirstRand's Rand Merchant Bank unit and Renaissance Capital have been appointed joint coordinators and book runners.From © Independent On-line 2013. All rights reserved.
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