Napier Port soars on debut as investors toast rare New Zealand listing
* Stock hits boards at NZ$2.91 vs NZ$2.60 IPO price
* Co plans to use proceeds to reduce debt, fund new wharf
* Second listing on NZX this year after Cannasouth float in
(Rewrites throughout; adds CEO and analyst comments, background
By Aditya Soni
Aug 20 (Reuters) - Napier Port Holdings, the
operator of New Zealand's fourth-largest port by container
volume, debuted at a 12% premium to its offer price on Tuesday,
as investors scooped up shares in a rare listing on the
The country's biggest IPO in at least three years comes amid
heightened uncertainty around the U.S.-China trade war that has
affected trading partners like New Zealand, and contributed to
weaker prices of log, the biggest export from the port.
However, Chief Executive Officer Todd Dawson told Reuters
that the port had not seen any slowdown in the actual volumes of
logs moving at this time.
"Talks with forestry sector customers have indicated that
the recent price slump in log price in particular has stabilised
and there were some signs of recovery as well," he said.
The company, whose port is located on the south coast of New
Zealand's North Island, hit the boards at NZ$2.91, giving it a
market cap of NZ$582 million ($373.76 million). The stock was
trading at NZ$3.0 as of 0332 GMT, compared with an offer price
of NZ$2.60 a share.
Napier Port raised NZ$234 million earlier this month, after
pricing its offering at the top end of a NZ$2.27 to NZ$2.60
range in an over-subscribed bookbuild.
Jeremy Sullivan, an investment adviser with Hamilton Hindin
Greene in Christchurch, said investors were attracted to the
company as "it is a good quality asset and was fairly priced".
The port operator has delivered profit growth for the past
two years and will join on NZX bigger peer Port of Tauranga,
which has beaten the benchmark for nearly two
Napier Port is 90% New Zealand-owned at listing and plans to
use the proceeds to reduce debt and fund the construction of a
new wharf to increase the port's capacity.
"Our main focus is on unlocking a congestion issue and we
are firmly on track of needing to expand the port for a whole
wider region," CEO Dawson said.
Napier Port is the second company to list in New Zealand
this year, following the smaller float of cannabis firm
Cannasouth in June, which had ended a two-year IPO
drought on the NZX.
The dearth of new floats has attracted shareholder
criticism, forcing the bourse to take remedial action, including
a partnership with Nasdaq Inc in 2018 to attract
NZX Chief Executive Officer Mark Peterson told Reuters last
week that he was aware of more listings as the exchange's
efforts to attract new floats come to fruition.
($1 = 1.5571 New Zealand dollars)
(Reporting by Aditya Soni in Bengaluru; Editing by Bernard Orr,
Jane Wardell and Subhranshu Sahu)
First Published: 2019-08-20 01:55:14
Updated 2019-08-20 07:12:25
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