The Western Australian company began trading on the Australian Stock Exchange today at $1.35, well above its initial public offer price of $1.
Through the oversubscribed offer, Nomad sold 78.3 million shares to raise $78.3 million. Venture capitalist ANZ Capital sold 80 per cent of its equity stake in Nomad in the IPO and will retain a 7.1 per cent of the listed entity
At the close Nomad was trading at $1.40 - up 40 per cent - after reaching a day high of $1.42.
The listing price was well above the company's expectations, chairman Geoff Allen said.
"I hadn't anticipated it being quite as high as it is, so from that point of view we were a bit surprised," Mr Allen said.
"We were looking at around $1.20, $1.25. Obviously people have faith in the company."
Nomad Building Solutions designs, manufactures and installs permanent and transportable modular buildings to the building, resource, energy and tourist industries of Western Australia and Queensland.
Major clients have included BHP Billiton Ltd, Rio Tinto Ltd and Newcrest Mining Ltd.
Following the listing, top of Nomad's agenda is finalising the $17.5 million acquisition of WA modular buildings company McGrath Homes.
Both companies have entered into an agreement pending the listing, with the deal to be finalised in December this year.
Expansion of the Nomad's Queensland operations, particular in the resources sector, is also top of the list, Mr Allen said.
"We've got the acquisition of McGrath Homes will go through now - we've got a lot of work to get that organised and integrated with us," he said.
"Plus we've got to spend a lot more time up in Queensland and get that up an running a bit better.
"I'd like to see about 15 per cent growth, which I think is very achievable.
"After that we'll look around and see what other opportunities are around."
The company will also have its hands busy constructing a 504-person village in the Pilbara region of WA for miner Fortescue Metals Group, under a $32.5 million contract announced yesterday.
Development of the village is expected to be completed by May next year.
In 2005-06, Nomad achieved pro forma revenues of $91.8 million and earnings before interest, tax, depreciation and amortisation of $18.2 million.
Nomad has forecast EBITDA to increase to $22.5 million in 2006-07, including earnings from the McGrath acquisition.
For related news of Nomad's contract with Fortescue, click here.
Below is a release from ANZ received late today:
ANZ Capital today successfully reduced its private equity investment in Western Australian based
company Nomad Building Solutions through an Initial Public Offering on the Australian Stock
Exchange.
Nomad is a leading provider of modular building solutions utilised by companies operating in the
resources, infrastructure, construction, tourism and leisure sectors.
In December 2005, ANZ Capital invested alongside 14 members of the Nomad management team
in a management buyout. Nomad has experienced strong growth over the last year, with EBITDA
increasing from $10.4 million in 2005 to $18.2 million in 2006 (including the acquisition of McGrath
Homes which is expected to take place in December 2006). Proforma1 2007 EBITDA is forecast
to be $24.2 million.
ANZ Capital sold 80% of its equity stake in Nomad in the IPO and will retain a 7.1% stake in the
listed entity, in a strong sign of its continued confidence in the company's prospects. Both ANZ
Capital and Management will receive a high cash back multiple on their investment, which
highlights the benefits of management buy-outs for investors.
Head of ANZ Capital Mr David Tonuri said: "This has been another successful investment by ANZ
Capital and what is most satisfying for us is the success the management team has had, and their
continued control of the strategic direction of Nomad."
ANZ Capital's internal rate of return on ordinary equity was in excess of 300%, with an estimated
cash back multiple of 3.5x money invested (at closing price today), following a successful debut by
the company on the ASX today.
WA Business News 31st October, 2006
