Joint bookrunners Deutsche Bank and BofA Merrill Lynch have just priced the NYSE IPO of NAB US agribusiness banking arm Great Western Bancorp at US$18, below...
Joint bookrunners Deutsche Bank and BofA Merrill Lynch have just priced the NYSE IPO of NAB US agribusiness banking arm Great Western Bancorp at US$18, below the US$21-$24 marketing range. NAB sold all of the 16m shares in the offering to cut its stake to 72.4% from 100%. Therefore all of the US$288m in proceeds go to NAB. The below range outcome was not surprising given market conditions and weak aftermarket performance from recent IPOs. Great Western is growing faster and is more efficient than its regional peers but NAB also sought a hefty multiple of 1.8x tangible book value at the midpoint. This would have made this the most richly priced bank IPO in the US this year. Great Western will debut on the NYSE tomorrow morning NY time. Would not expect a large bounce given the large overhang and the generally subdued aftermarket performance from regional bank IPOs this year. At least by taking the discount, NAB may be reasonably placed to do a secondary offering in six months' time (after lock-up expiry) at a higher price.
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