Onsite rentals IPO priced at up to $430m

Onsite Rental provides construction and industrial equipment rental. Picture: iStock

Onsite Rentals has been priced as a company worth between $400 million and $430m for its initial public offering.

It plans to raise between $238.9m and $252.8m

The share price range will be between $2.87 and $3.15.

The pricing equates to between 4.9 and 5.2 times its earnings before interest, tax, depreciation and amortisation.

The company, which offers equipment to the mining and infrastructure sectors, on Monday launched its management roadshow for a float being run through Macquarie Capital and Bank of America.

The business offers rental equipment to businesses with 33 branches across Australia and a fleet of 70,000 assets, primarily for access, power and site accommodation.

The news comes after earlier expectations that the group would be priced at between 4 and 5 times its EBITDA and sell down three quarters of the company.

The group’s net debt will be $89.9m and its enterprise value between $490m and $520m.

The dividend yield for the 2020 financial year will be between 4.7 per cent and 4.4 per cent.

Onsite Rentals will launch its bookbuild on October 28 and 29 and the prospectus for the offer will be lodged on October 30.

The company has been owned by Next Capital and is now controlled by US debt investors.

Market share currently sits at 7 per cent and the business services the resources, infrastructure, commercial and industrial property industries.

About 46 per cent of its revenue is generated from the resources industry, of which more than 70 per cent is from long-term production and maintenance contracts with major mining companies, and about 22 per cent is from infrastructure, predominantly on the east coast.

Onsite Rentals has made an attempt to list in the past, but the deal was pulled at the time by its private equity owners and has since been recapitalised.