Latitude Financial Group has sent a message to the market on its initial public offering, suggesting that early indications are that demand exceeds its offer size, assuming that $330 million of the deal is allocated to retail investors.
Retail investors have been asked to confirm their broker firm allocations over the course of Tuesday as the book build for the float takes place.
The company is due to list on Friday.
The news comes after Latitude Financial Group on Monday repriced its initial public offering to $1.78 per share, in a move that will see the business list as one with a $3.17 billion market value.
The raise size is also less, now about $1bn.
The move to lower the price was understood to be linked to a desire to see the non-bank lender trades well in the aftermarket at a time of a fickle IPO market globally.
The price now equates to 11 times forecast net cash profit, equating to a 5.8 per cent yield.
On Friday, the company had locked in its IPO price at $2 per share ahead of the book build for the IPO this week.
At that time, the group also locked in a raising size at the bottom of its range at $1.245bn and the dividend yield was to be 5.2 per cent.
Other deals this year have been riding on the success of Latitude, which provides personal and in-store credit card loans as well as a buy-now-pay later service.
The final result will be released to the market on Wednesday.
The Latitude pricing comes after plans for the IPO of MPC Kinetic shelved last Thursday night after it was downsized on the back of weak demand.
Latitude, which is run by Ahmed Fahour, had earlier planned to launch a bookbuild with shares to be sold between $2 per share and $2.25, equating to a market value range of between $3.556bn and $4bn.
It was expected last week that non-bank lender Latitude, which provides in-store credit cards to for retailers such as Harvey Norman, would price its IPO at the bottom end of its price range.
The prospectus had the company valued at between 7.8 times and 8.8 times Latitude’s pro forma adjusted earnings before interest, tax, depreciation and amortisation.
The former GE Australian and New Zealand consumer lending business and is owned by Kohlberg Kravis Roberts, Varde Partners and Deutsche Bank.
Working as joint lead managers on the IPO are Goldman Sachs, Macquarie Capital and UBS, while Insight Capital is advising Latitude’s shareholders.
The group was initially planning to raise between $1.24bn and $1.4bn.
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