Australian Finance Group Ltd (AFG or the Company) today lodged a prospectus (the Prospectus) with the Australian Securities and Investments Commission (ASIC) for an initial public offer (IPO) and listing on the Australian Securities Exchange (ASX). The IPO is expected to raise between A$121.3 million and A$140.1 million, based on an indicative price range of A$1.20 to A$1.38 per share. Based on the mid-point of this range of A$1.29 per share, approximately A$35 million will be raised by the issue of new shares by AFG (before costs) and approximately A$95.9 million will be raised by the sale of shares by existing shareholders.
Defined terms in this release have the same meaning as in the Prospectus.
The IPO includes an institutional offer, a broker firm offer and a A$10 million priority allocation to AFG staff, mortgage brokers and others. Macquarie Capital (Australia) Limited (Macquarie Capital) is the Lead Manager and Morgans Corporate Limited is the Co-manager to the IPO.
AFG was founded in 1994 and has grown to become one of the biggest mortgage broking groups in Australia, with more than 2,300 AFG Brokers distributing over 1,400 mortgage products supplied by AFG’s panel of over 30 lenders. The AFG Loan Book currently sits at more than $100 billion, the largest Australian loan book outside the major banks.
AFG co-founder and managing director Mr Brett McKeon said funds raised in the IPO would be used to purchase the equity of certain existing shareholders and to provide funding for operations and growth. Existing shareholders will continue to own approximately 52.7% of AFG, with shares owned by the co-founders and certain other existing shareholders escrowed until the release of the Company’s FY2016 results.
“We have received a number of offers for the company since we started operations more than 20 years ago, but we believe listing on the ASX is the best avenue to ensure AFG’s sustainable growth and to retain and attract brokers to our network,” Mr McKeon said.
“We are a significant player in a growing market and we are confident of delivering long term returns to shareholders.”
“We have shown a consistent ability to generate profits through the residential property cycle and with almost 50 per cent of our revenues being generated through trail commission on the existing AFG Loan Book, we believe we have an attractive mix of recurrent earnings and growth.”
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