Specialist healthcare provider Aurora Healthcare is seeking to raise up to $414.8 million at 19.7-times profit for its initial public offering.

Brokers Bank of America and UBS sent terms to fund managers on Monday. 

Shaw and Partners, Canaccord and Ord Minnett were named as co-lead managers, while Crestone and JBWere scored junior selling roles. Allens is doing the legal work and PwC was investigating accountant.

The term sheet set out a $373.9 million to $414.8 million raising at the fixed price of $2, to list with a $800 million to $801 million market capitalisation.

The priced implied 19.7-times Aurora’s forecast profit for the 2021 calendar year, the term sheet said.

Owner Healthe Care, which is controlled by China’s Luye, would retain a 30 per cent to 35 per cent stake on listing.

The launch comes after BoA and UBS ran a cornerstone offer last week that wrapped up on Friday. The IPO price was at the bottom of the cornerstone range.

New shareholders would own 46.8 per cent to 51.8 per cent of the company on listing, according to the term sheet.

Aurora is pitched as Australia’s second-largest private mental health provider and fourth-largest private rehabilitation services group. It has 25 sites, including 16 in Australia and nine in Singapore and is part of Healthe Care.

The company expected to report $453.9 million revenue in the 2021 calendar year and $103.9 million earnings before interest, tax, depreciation and amortisation. Those numbers were up from $417.1 million and $86.3 million last year.

Aurora was slated to list with $129.2 million in interest bearing loans and lease liabilities worth $381.1 million, for 1.7-times net leverage.

Collins Food Group’s Robert Kaye was named as Aurora chairman, while other directors included Luye’s Aona Liu, ex-Healthscope CFO John Hickey, former Singaporean politician Teo Ser Luck nad ex-Macquarie banker Andrew Low.

If the IPO is successful, Aurora shares would trade on a normal settlement basis from June 2.

The offer is currently open to sophisticated or professional investor clients only.

Article source: AFR, 3 May 2021