Kathmandu plans A$375m IPO

Australian firms Goldman Sachs JBWere Private Equity and Quadrant Private Equity become the latest to seek an exit through the stock market. The outdoor and travel clothing and equipment company plans a dual listing in Australia and New Zealand.

Kathmandu Holdings, backed by Goldman Sachs JBWere Private Equity and Quadrant Private Equity, plans to raise up to A$374.9 million ($348 million; €232 million) in an initial public offering (IPO).

The travel and adventure clothing and equipment retailer intends to list on the on the Australian Securities Exchange and the New Zealand Stock Exchange. It will offer between 166.9 million and 197.4 million shares, which represent between 84 percent and 99 percent of the company. The issue is estimated to raise between A$277.7 million and A$374.9 million, with each share offered from A$1.65 to A$1.90, according to the company prospectus. The company is due to go public on 18 November.

Goldman Sachs JBWere and Quadrant led a management buyout of Kathmandu in 2006. According to Quadrant's website, it has invested just under A$44 million in the company. Presently, each firm holds a stake of 48.6 percent in Kathmandu while its management holds the remaining 2.8 percent. After the issue, each firm will potentially hold a stake of up to 7.5 percent in the company, while management will hold 1.3 percent.

Kathmandu has 82 stores across Australia, New Zealand and the UK and plans to open 12 more stores in Australia and New Zealand this fiscal year. The company booked sales of A$176 million this financial year, up from A$133 million two years earlier. As of 31 July, it has pro forma net debt of A$57.4 million.

Private equity firms are looking to exit their investments in Australia following a rally in the country’s capital markets that began this March. Last week, Ascendia Retail, which is backed by Sydney-based Archer Capital, appointed three banks to advise on the listing of the Australian sports stores chain. Ascendia’s float, not expected until 2010, is estimated to fetch between A$800 million and A$1 billion.
 
Ascendia's IPO will follow that of Myer Group, the country’s largest chain of department stores, which is backed by private equity firms TPG Group and Blum Capital. The company is due to go public on 2 November and could fetch up to A$3 billion, according media reports.