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Link (ASX:LNK) intends to sell off nearly half of its current holdings in PEXA if its initial public offering goes ahead.
In a market release dated 23 October 2018, Link Administration Holdings Limited (ASX: LNK) clearly stated that it will sell down approximately 12.5 million of its current 26.5 million shares in PEXA if the online property conveyor Property Exchange Australia Limited (PEXA) continues with initial public offering.
The announcement came after the PEXA unveiled its plan to go independent through getting publicly listed on Australian Securities Exchange. Under the initial public offer, PEXA seeks to raise up to A$862 million through institutional and retail offer.
It is estimated that proceeds from IPO would be majorly utilized for the payment of PEXAâs current investors like Link, who are opting to sell down or sell out altogether while just $80 million or less would be injected in business.Â
Link Administration Holding Limited owns 18% interest in PEXA that represents an online property company jointly owned by Macquarie Group, Westpac, National Australia Bank, Link, Commonwealth Bank, state government and renowned property developer Paul Little.
But even after the sell down, Link will continue to hold 10% of the issue capital of PEXA that represents 14 million shares, subject to voluntary escrow. The company stated that the sell down of 12.5 million shares in PEXA is expected to generate $165 million and above proceeds, depending upon the price of the IPO.
Further, it has been heard that NAB, Westpac and ANZ may sell out their complete holdings in PEXA while Macquarie Group intends to sell down some of its shares in float and retain remaining 20%.
As per the presentation made to institutional investor PEXA has been valued at up to $2.2 billion. The book-builds process is reported to start from tomorrow, i.e. 24 October 2018 seeking to fetch as much as $15.80 per share.
Following the completion of book-building process, PEXAâ stock is expected to commence trading from 19 November 2018.
Linkâs intention to sell half of its current holding in float has witnessed bearish market sentiments in todayâs trading session. The share price of Link administration has fallen by 0.518% or $0.040 to close at $7.680 on 23 October 2018. In the previous one year, the stock price of Link administration is constantly dipping down, recording 3.50% plunge over past 12-months period. LNK traded at PE ratio of 27.030 x with market capitalization of $4.09 billion as on 23 October 2018.
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