Vehicle distributor and service provider The Ateco Group appears to have paused plans for its initial public offering for now amid a period of market volatility linked to Russia’s attack on Ukraine.
The business held meetings with investors in early February about its plans to float the company with a market value between $500m and $1bn by June.
Since that time, there is no management roadshow that has been locked in for a listing, and this would typically occur straight after reporting season if fund manager interest has already been tested in the weeks earlier and the deal was favoured by investors.
Sources in the market say that some brokers turned down the option for meetings about an Ateco float and there have been suggestions in the market that the deal was not well supported.
While a media adviser working for the company said that the float was not off, nor was it paused, other sources close to the situation said that work had stopped on the float for now, amid a period of market volatility.
Wider suggestions in the market are that the inital public offering is not moving forward.
Ateco, chaired by New Zealand businessman Neville Crichton, has been advised by Goldman Sachs.
It generated about $70m of annual earnings before interest and tax and $1.1bn of revenue in the 2021 financial year when it sold 23,000 vehicles, up 95 per cent on fiscal 2020.
In the next year, Ateco expects growth of 60 per cent.
Ateco sells brands such as Citroën, Alfa Romeo, Kia, Fiat, Ferrari, Maserati, Chery, Great Wall, Ssangyong, Foton and Lotus.
With 130 dealers, the group also distributes LDV, Maserati and Renault in Australia and Fiat Chrysler across the Tasman, as well as remanufacturing RAM Trucks into right hand drive for sale.
Automotive dealerships are considered tough businesses to list in the current market and late last year, Archer Capital placed its plans on hold for a $500m listing of rival Autopact.
Quadrant Private Equity listed automotive company Peter Warren in early 2021, with shares priced at $2.90 each as it raised $260m.
Its share price is now around $2.68 with its market value at $459m.
Compounding problems has been the market uncertainty.
On Monday, the S&P/ASX 200 closed up 0.7 per cent.
But it fell more than 3 per cent in one trading session last week after war broke out in the Ukraine in what was its largest one-day decline in over a year.
Other companies hoping to list are AMart Furniture, advised by Jefferies, UBS and Morgans while global ESG commodities platform Xpansiv is pushing on with its plans to list as a $2bn-plus company and currently meeting with investors.
Working for Xpansiv are Barrenjoey Capital Partners, UBS and Shaw and Partners.
It is expected to raise at least $500m.
Superior Food Services, also owned by Quadrant, is weighing a listing of its own, as is gold analysis business Chrysos Corporation and chemicals ingredients distributor Redox.
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