Lists 12noon today.
It was 10X oversubscribed as reported in The Australian. Lets see how it goes when it lists today. Branching out: Moelis set to hit the ASX
The Australian, April 10, 2017
Moelis Australia plans to grow its asset management business with the $60 million it raised through its initial public offering and will begin trading on the Australian Securities Exchange today.
Almost 400 high net worth investors and the boutique investment bank’s private clients bought into the float when the shares were sold at $2.35 as part of the launch in mid-February.
Under the ownership structure, just 20 per cent of Moelis Australia will trade on the ASX, with the remaining 80 per cent owned by the Moelis global parent company and the bank’s local staff.
The bank’s prospectus showed Moelis’s statutory net revenue was expected to be $73.2m in 2017, up from $35.4m three years ago. Its net profit for the calendar year is predicted at $18m on $25.2m earnings before interest and tax.
The bank is chaired by former Channel Nine managing director Jeffery Browne, while chief executive Andrew Pridham’s stake in the bank is worth about $50m.
Mr Pridham, also chairman of AFL’s Sydney Swans, said the bank was keen to steadily expand its asset management business, which has seen its net revenue increase from $2.4m in 2014 to $15.6m last year. The division has $1.1 billion in funds under management. Mr Pridham said a listing would help the bank’s business in the Australian investment banking market.
Moelis has developed a strong reputation in corporate restructuring and is also building an equities trading and research business.
“The structure that we had was really good to allow us to build the business. It gave us access to global markets through Moelis and enabled us to give equity to our senior executives, which is something that bankers want,” he told The Australian.
“If you work in a global investment bank, which I have spent most of my career doing, there’s really no alignment to being paid in stock — it’s almost like handcuffs. The business model was always designed to attract good people and we have had low staff turnover.”
Mr Pridham downplayed concerns in the financial markets that he and his senior management could use the bank turning public as an opportunity to cash out.
There has also been criticism that Moelis’s most valuable assets are its senior bankers, who could easily leave the business and take key clients to rival institutions.
“We have voluntarily put a six-year vesting on our stock. We are clearly not doing it to get out. We are listing it for growth,” he said.
“Initially when you say you’re going to float, people think ‘oh you’re selling out’. I don’t why people think that but that’s the common reaction.
“None of us have sold a share, and we are voluntarily locking our shares for six years. It’s a strong motivation for people not to leave and instead build the business.”
The Moelis float, which was self-advised during the IPO process, was 10 times oversubscribed and most of its 80 staff bought new stock.
The top 20 shareholders will be published today and market observers are keen to see whether Moelis and Mr Pridham’s associates bought into the float.
“The additional capital we are raising is important to grow the business,” he said.
“Our main focus on growth is going to be asset management,” he said. We only started that business in 2013 and it has been growing very quickly and having additional capital, we see opportunities where we can expand.”
MOE Price at posting:
0.0¢ Sentiment: None Disclosure: Not Held
