Is online retailer MyDeal reconsidering an IPO?

MyDeal has been compared to other online market places such as Kogan or Temple and Webster and has hopes to raise between $60m and $85m.

Online retailer MyDeal is said to be reviving its attempts to embark on an initial public offering in a move that could see it secure up to $85m as it capitalises on the current demand for shopping through the internet.

Working on the transaction is Morgans Financial and RBC Capital Markets.

The company was founded by Sean Senvirtne and is recently said to have moved into profit making territory.

 

MyDeal has been compared to other online market places such as Kogan or Temple and Webster and has hopes to raise between $60m and $85m.

It sells a range of goods, including furniture, appliances, sporting and outdoors products, tools and equipment, health and beauty products, fashion and books and media.

The group will launch a non-deal road show to test investor appetite for a transaction next week.

Already, MyDeal has carried out a pre-IPO raising through the form of a convertible note last year.

The note has a trigger point that provides motivation for a float to happen within a year from the launch of its issue.

This year, the business, which counts the Gandel family as among its supporters, was on track to generate about $60m in annual revenue.

Online retailers are well positioned amid the current coronavirus-impacted environment, with shoppers increasingly growing comfortable with carrying out transactions online.

One of its comparables, Kogan.com, has performed strongly since listing during 2016, with its market value now at $1.79bn, with its share price growing from about $1.50 to more than $17.

Last month, conglomerate Wesfarmers indicated that its $230m acquisition of the online marketplace Catch Group was paying dividends.

Wesfarmers said for its sales performance to May that gross transaction value for Catch Group was up 21.4 per cent for the first half of 2020, but that had accelerated to growth of 68.7 per cent for the second half to date.

For the full financial year, representing 11 months of fiscal 2020, Catch sales were up by 43.7 per cent.

It comes as traditional retailers such as department stores David Jones and Myer continue to face trading uncertainty, with a second wave of coronavirus impacting Victoria.

It proves poor David Jones when it comes to the sale of its retail properties in Melbourne and Sydney through UBS.

The sales process is now underway, and the thinking is that they could sell for between $500m and $1bn.

However, much of the price any party is expected to pay is likely to depend on the sale and leaseback terms with the department store for any new owner.