Eclipx Group shares rise 20 per cent after IPO

Shares in fleet management and car financing company Eclipx Group rose more than 20 per cent on their ASX debut.

Shares in Eclipx Group rose more than 20 per cent on their ASX debut, underscoring the strong investor interest in the initial public offering of the fleet management and car financing company.

The stock closed at $2.78, up 21 per cent on its issue price, with about 36 million shares, or about 15 per cent of the total equity, changing hands on its first day of trading.

The IPO raised $253 million through a sale of shares by private equity firm Ironbridge and Singapore’s GIC, as well as issue of new shares.

All shares were issued at $2.30 each, giving the company a market value of $518m on listing. Its bookbuild last month was oversubscribed as global and local investors piled in.

Eclipx, which operates under the FleetPartners brand, was founded in 1987 as part of ANZ Bank, before moving into private equity hands.

The fleet management and vehicle leasing specialist controls about 10 per cent of the $14.7 billion vehicle leasing market in Australia and 21 per cent in New Zealand, according to its pros­pectus.

The company is looking to build on the increasing trend towards companies outsourcing the financing and management of their vehicle fleets, as they focus on cost efficiencies.

For fiscal 2015, Eclipx is forecasting net profit of $44.6m on a proforma basis and $32m on a statutory basis, compared to net profit of $21.2m last year.

The issue price represents 11 times 2015 forecast net profit. The company forecast an indicative dividend yield of 4.8-5.6 per cent.

Private equity owner Ironbridge has retained a 41 per cent stake in the company, while GIC has sold its 38 per cent interest.

The strong listing is expected to bolster the IPO pipeline in Australia. Technology company TouchCorp kicked off proceedings last month with an impressive debut, while accounting software firm MYOB will debut on the ASX next month in the year’s biggest listing so far.

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