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Australia’s Nine details A$2 billion IPO

Australian media and broadcast group Nine Entertainment has issued a prospectus ahead of an IPO and listing on the Australian Securities Exchange, which values the company at about A$2 billion (US$1.9 billion).

Nine Entertainment comprises the Nine Network free-to-air broadcasting operation, Nine Digital and Ventures, which incorporates the Mi9 digital service (fka ninemsn) and Nine Events. The IPO will see Nine shares trading on the ASX from December 6.

Nine Entertainment CEO David Gyngell said: “A listing on the ASX will help us to continue our strong momentum and consolidate our position as a leading FTA TV network in Australia, maintain our strong industry position and expand the Nine Events business, and continue to grow Mi9 and our other digital media assets.”

The proposed IPO will see A$275 million of new cash raised, A$198 million of which will be used to pay down debt and the remainder used as cash on hand.

Analysts were positive about the planned IPO noting it will reduce debt and provide a more transparent financial structure.

“In addition to the benefits of reduced leverage provided by the IPO, should it proceed on the terms announced, the IPO would also lead to improved visibility because the current financial sponsor ownership structure (53% pre-IPO combined stake by Apollo Global Management and Oaktree Capital Management) will be replaced by public company disclosure and compliance requirements, which Moody’s sees as being more stringent,” Moody’s said in a note on the IPO,” Moodys noted.