Peet IPO closes oversubscribed

Land developer Peet and Company has closed its initial public offering after applications exceeded the maximum share offer.

The company is currently scaling back applications to the maximum level of 84 million shares, which will be issued at $1.20 to raise $100.8 million.

Existing investors in Peet syndicates have been given preferential treatment in the share allocation process.

Peet managing director Warwick Hemsley said he was delighted with the strong response to the offering from retail as well as institutional investors.

Peet shares will begin trading on the Australian Stock Exchange on August 5, with more than 2,700 shareholders keeping an eye on Western Australia’s biggest float this year.

The float will deliver considerable financial benefits to Peet’s vendors, including Mr Hemsley and chairman Tony Lennon, who will retain 58 per cent ownership

Peet’s name has also been suggested as a possible purchaser of Lensworth Group, recently put up for sale by Foster’s Group.

Lensworth is a residential property developer currently developing major communities in Queensland, New south Wales, Victoria and South Australia.

“We believe there are excellent growth opportunities in Australia through continued development of existing projects, acquisition of new projects and expansion of property funds and management products,” Mr Hemsley said.

“Investors in this offering will participate in profits from development of one of the largest holdings of residential land in Australia.

“These holdings are made up of approximately $197 of Peet’s owned land plus large estates managed by Peet through syndicates of joint ventures.”

Peet has continually traded in WA for 99 years, and is one of Australia’s largest property companies dedicated to broadacre estate development with 38 projects in WA, Victoria, Queensland and New South Wales.

Acquisitions are predominantly made using investors equity, through syndicates and joint venture projects.  Peet has closed 10 syndicates since 1997, raising a total $88 million.

UBS acted as financial adviser and underwriter to the raising.