Former Portman Ltd managing director and Aztec Resources Ltd chairman Ian Burston has been appointed chairman of mining and earthmoving contractor NRW Holdings Ltd, which has lodged a prospectus for its $303 million initial public offering.
Former Portman Ltd managing director and Aztec Resources Ltd chairman Ian Burston has been appointed chairman of mining and earthmoving contractor NRW Holdings Ltd, which has lodged a prospectus for its $303 million initial public offering.
As revealed by WA Business News last month, existing NRW shareholders will retain a 40 per cent stake in the company, which is expected to list on the Australian Securities Exchange on September 5.
The float, which is the biggest for a WA company this year, involves NRW issuing 152 million shares at $2 each, and gives the company a market capitalisation of $502.5 million.
NRW's float coincides with takeover speculation surroundiug two of its main competitors, Leighton Holdings and Perth-based Macmahon Holdings. Leighton has taken a 11.5 per cent stake in Macmahon, which has a market cap of $690 million.
More than $262 million of the float proceeds will be used to pay vendor shareholders, including founding chief executive Jeffrey McGlinn, while $24 million will be spent repaying bank debt, $14 million on fees and expenses and $8.6 million will be used to fund future growth opportunities.
Mr McGlinn's 20.2 per cent stake in NRW will be reduced to 9.1 per cent while the percentage of the business owned by other senior management will fall from 29.8 per cent to 14.7 per cent.
One of NRW's biggest shareholders, US hedge fund Stark Investments, has agreed to reinvest $5.8 million back into NRW. Stark's stake will reduce from 25.6 per cent to 12.7 per cent.
Former Action Mining Services boss Steve de Mol will get a 0.5 per cent stake after agreeing to sell his business to NRW in March in a deal worth $27.8 million. NRW paid Mr de Mol $23.8 million in cash and $2.5 million via scrip.
Mr McGlinn and John Silverthorne jointly established NRW in 1994.
Mr McGlinn will remain chief executive officer while Mr Silverthorne will take on the title of managing director, NRW Civil and Mining.
NRW will pay its top three executives close to $3 million a year excluding superannuation and other benefits. Mr McGlinn will receive an annual salary of $1.5 million, Mr Silverthorne will be paid $1 million a year while NRW general manager and shareholder Julian Pemberton will receive a $400,000-a-year wage for his role as chief operating officer in the new group.
Investment bank UBS is the lead manager and underwriter of the share offer.
The prospectus also reveals NRW's strong position in the sector. Its revenue more than doubled last financial year to $186.2 million and the directors are expecting revenue to come in 38 per cent higher for 2006-07 and jump by 71 per cent in 2007-08.
NRW said it expected to post a statutory net profit of $12.7 million for 2006-07 and $32.1 million in 2007-08.
