Archer appoints advisers to Ascendia IPO

Goldman Sachs, Bank of America/Merrill Lynch and UBS have been hired. The listing of the chain of sports stores could fetch up to A$1 billion, according to some reports.

Sydney-based Archer Capital has appointed three banks to advise on the listing of portfolio company Ascendia Retail on the Australian Stock Exchange, a source close to the firm has confirmed.

Goldman Sachs, Bank of America/Merrill Lynch and UBS have been hired to advise on the listing of Ascendia, which local media reports have said could raise between A$800 million (US$728 million; €489 million) and A$1 billion. The company is not expected to float until next year.

Ascendia Retail is comprised of three Archer acquisitions and includes high street chains Amart All Sports and Rebel Sport. Archer backed the management buyout of Amart, a Queensland-based chain of 26 sports stores, in 2004, adding a smaller sports retailer, Rowe & Jarman, in 2005. Rebel Sport, Australia’s largest sports retailer, was added in 2007 after Archer delisted the company in a deal valued at A$369 million. Ascendia Retail now has more than 150 outlets across Australia and, according to a Reuters report, annual sales of A$670 million.

Ascendia will follow on the heels of TPG-backed Myer Group, Australia’s largest chain of department stores, which is due to go public on 2 November. With a share offer price of A$3.90 to A$4.90, media reports have estimated the float could fetch up to A$3 billion. This would give private equity firms TPG Group and Blum Capital, which currently hold 81.4 percent of the company's equity between them, a cool A$1.9 billion to share.

Ascendia was only one of several private-equity backed retails firms said to be eyeing the public markets in the wake of the Myer offer.

Amongst others which have been cited in media reports as considering the IPO route is Kathmandu, a chain of outdoor wear and adventure equipment shops, which it is estimated could fetch around $400 million on the Australian Stock Exchange. Kathmandu is owned by Quadrant Private Equity and Goldman Sachs JBWere Private Equity, which backed the company in 2006 in a management buyout. According to Quadrant's website, it has invested just under A$44 million in Kathmandu. Each firm holds 50 percent of the company’s equity.