REAL-WORLD CASE STUDY
This is a short case which brings together
several of the financial issues that we
have been discussing in Part II: the role
of shares in capital raising for a company;
the procedural stages that underpin the
process of ‘going to market’ for funds,
especially for a company that is going
public for the first time; and the sorts of
information that the capital markets seek
when deciding whether to invest in a (new)
company in the hope that the investment
will add value to the investors’ portfolios.
All of these elements have been examined
separately in Part II, and the case of MYOB
offers a chance to see them interacting in a
real situation.MYOB Group Limited (MYOB) today
lodged with the Australian Securities
and Investments Commission (ASIC) a
Prospectus for an initial public offering
(IPO or Offer) and listing on the Australian
Securities Exchange (ASX) of its fully paid
ordinary shares (Shares). The offering to
retail and institutional investors is expected
to raise total proceeds of A$831.7 to
A$833.8 million based on an indicative
price range of A$3.00 – A$4.00 per Share,
valuing the company at a total enterprise
value of A$2.34 to A$2.69 billion.
Established in 1991, MYOB is Australia
and New Zealand’s leading accounting
software provider. It makes business life
easier for over 1.2 million businesses across
Australia and New Zealand by simplifying
accounting, payroll, tax, CRM, websites, job
costing, practice management, inventory,
mobile payments and more.
MYOB is currently majority-owned by
Bain Capital. Bain Capital will not sell any of
its Shares in the Offer. At completion of theOffer, Bain Capital will hold approximately
57% of the total issued capital of the
Company, assuming that the Final Price is at
the mid-point of the Indicative Price Range
and that 50% of the Existing Retail Notes
are exchanged through the Noteholder
Exchange Offer. Bain Capital has entered
into an escrow arrangement in relation to its
Shares.
The Offer is being conducted to raise
capital to reduce some existing liabilities
(including senior debt and mandatory
redeemable preference shares); allow
Management Shareholders to partially
monetise their investment; and provide
MYOB with access to the capital markets
to improve capital management flexibility.
The Offer further intends to provide a liquid
market for shares and an opportunity for
others to invest in MYOB.
The retail component of the Offer
includes a Broker Firm Offer, a Priority
Offer and an Employee Offer and is
scheduled to open on 13 April 2015.
The Noteholder Exchange Offer is also
scheduled to open on 13 April 2015.
The institutional component of the Offer
(Institutional Offer) is scheduled to open
on 13 April 2015 and close on 27 April
2015.
Citigroup Global Markets Australia Pty
Limited, Goldman Sachs Australia Pty Ltd,
Merrill Lynch Equities (Australia) Limited and
UBS AG, Australia Branch have acted as Joint
Lead Managers to the Offer. Reunion Capital
is financial adviser to the Offer. Clayton Utz is
MYOB’s Australian legal adviser. MYOB is
also being represented by Ropes & Gray,
Hong Kong, as to certain matters of U.S.
federal and New York state law.SHARING YOUR OWN BUSINESS