Astro locks in cornerstones for IPO
UPDATED @ 03:10:13 PM 20-09-2012
KUALA LUMPUR, Sept 20 — US hedge funds Och-Ziff Capital Management and Standard Pacific Capital are among 16 cornerstone investors in the US$1.5 billion (RM4.8 billion) listing of pay-TV firm Astro Malaysia Holdings, a term sheet showed, underscoring international investors’ growing interest in Malaysia.
Nomura Asset Management, Great Eastern Life Assurance and Malaysian state-owned fund management firm Permodalan Nasional Bhd are some of the other cornerstone investors, the term sheet seen by Reuters showed, in what is set to be Malaysia’s third-biggest IPO this year.
So-called cornerstone investors are guaranteed large allotments in IPOs in return for holding the shares for a certain period of time, giving investors confidence in a deal.
Slightly more than half of the IPO’s institutional offering was allocated to local and international cornerstone investors, according to the term sheet. The portion of the IPO allocated to Malaysian investors was six times oversubscribed, it showed.
The interest in Astro, controlled by Malaysia’s second-richest man T. Ananda Krishnan, comes after the strong response to some other large IPOs from the nation.
Palm oil firm Felda Global Ventures Holdings raised US$3.3 billion when it listed in Kuala Lumpur in June, making it the world’s third-largest IPO so far this year.
Felda had orders from cornerstone investors for nearly one-third of its deal, while cornerstone investors bought around 62 per cent of IHH Healthcare’s US$2.1 billion Malaysia IPO in July.
“Malaysia is a very different market,” said Abdul Jalil Abdul Rasheed, who helps manage US$3 billion as CEO of Aberdeen Islamic Asset Management in Kuala Lumpur. “Malaysia loves large IPOs so I think take up will be strong, judging from previous issues.”
Equity issuance in Malaysia stands at about US$7.9 billion so far this year, compared with US$3.9 billion in the whole of last year, and shares listed in this year’s Malaysian IPOs have gained 17 per cent on average since the companies were listed, according to Thomson Reuters publication IFR.
Astro is offering up to 1.52 billion shares in its IPO, of which 597.69 million shares will be offered to indigenous, so-called Bumiputera investors, 661.75 million to institutional investors, and the balance to retail investors.
Based on an indicative price range of RM2.70-3.00 per share, the total shares offered by the country’s largest pay-TV firm by market share could be worth RM4.1 billion-4.56 billion.
Other cornerstone investors in the IPO comprised Antelle Holding, Areca Capital, hedge fund Azentus Global, Corston-Smith, Gordel Capital, Kencana Capital, ECM Libra, Myriad, Malaysian tycoon Chua Ma Yu, TPG-Axon and pension fund Universities Superannuation Scheme, the term sheet showed.
Astro will open its institutional book today and close on October 3, with pricing and allocation on the last day, according to the term sheet.
The initial retail offer price is RM3.00 per share and the offer will open tomorrow, with listing slated for October 19, the term sheet showed.
Ananda, who owns telecom and energy companies, is relisting Astro after it was privatised in 2010 in a deal that valued it at around RM8.5 billion.
The company will use the proceeds from the relisting to repay bank borrowings, for capital expenditure, working capital and listing expense, the term sheet showed.
The IPO is being handled by CIMB Group Holdings Bhd , Malayan Banking Bhd and RHB Capital Bhd. Several foreign banks are also advisers, including UBS AG, Credit Suisse Group AG, Goldman Sachs Group Inc and JPMorgan Chase & Co. — Reuters