AFT Pharmaceuticals IPO Confirmed and Product Disclosure Statement Lodged
Demand for AFT shares strong, final share price set at $2.80
Investors will soon be able to buy shares in growing New Zealand and Australian-based multinational pharmaceutical company, AFT Pharmaceuticals Limited (“AFT”).
AFT today confirmed its IPO and lodged a Product Disclosure Statement for the initial public offering of ordinary shares in the company (the “Offer”). The Product Disclosure Statement and link to the Register Entry containing additional material information about the Offer will be available at www.aftpharmshares.com. AFT intends to list on both the NZX Main Board and the ASX next month.
CEO, Dr Hartley Atkinson and his wife, Marree, founded AFT Pharmaceuticals in their family garage in late 1997. Today the company sells over 100 products in New Zealand, Australia, Asia, and in a growing number of European countries. In the last full financial year, AFT operating revenues were NZ$56.2 million.
Following a successful bookbuild, AFT shares have been priced at $2.80 a share. The final Offer size has been set at 11.9 million ordinary shares (being $33.2 million) and includes $30.2 million of new capital to fund growth of AFT, including further development of key products. As part of the IPO, the trustees of the Atkinson Family Trust (“Selling Shareholders”) associated with founder, CEO and majority shareholder Hartley Atkinson will sell down $3.0m, retaining a 76% stake post the Offer. The Selling Shareholders will be offerors under the Offer and AFT will be the issuer under the Offer. Based on the $2.80 price per share, the company’s market capitalisation will be $269 million
Dr Atkinson said the success of the company has been built on an intensive R&D programme that has produced key innovative products such as Maxigesic and Maxiclear PE. AFT then out-licenses these products to other companies to sell around world but the intellectual property behind products such as Maxigesic and Maxiclear PE remains with AFT through patent protection.
“Currently AFT has entered into out-licensing or distribution agreements in more than 35 countries around the world with ongoing negotiations to extend agreements to over another 70 countries,” said Dr Atkinson.
“We have been delighted with the interest shown by potential investors. Institutional investors have been impressed with both our diversified product portfolio and our people which has led to strong revenue growth to date, with potential for further growth internationally”, AFT Chair David Flacks says.
The Offer has received strong support from institutional investors with demand exceeding the size of the Offer at the final share price. Shares under the Offer have been allocated to institutions in New Zealand and Australia, as well as certain NZX Firms on behalf of their retail investor clients. A U.S. private placement will take place concurrently with the institutional offer. A Priority Offer of $3.0 million is available to New Zealand and Australian resident customers, suppliers and employees of AFT, and other persons invited to participate by AFT. AFT has also provided for up to $4.0 million in oversubscriptions for the Priority Offer at its discretion.
“Following today’s bookbuild, it is pleasing that a number of New Zealand and Australian institutions have participated in the IPO, particularly in a year of subdued equity market activity in New Zealand” says Chair David Flacks. “We are also encouraged by strong participation from existing shareholders. The Priority and Broker Firm Offers will open on Friday 4th December and we look forward to welcoming eligible investors as shareholders in the company.”
Managing and founding director, Dr Hartley Atkinson, says that the timing of the IPO is perfect for AFT. “This float is really about AFT going to the next level” says Dr Atkinson. “We’ve built up strong sales figures in our home markets of Australia and New Zealand over a number of years. Historically we’ve funded this growth through operating cash flow.”
“But the opportunities to sell our existing products like Maxigesic to new international markets, and to advance our pipeline products like the SURF Nebuliser are significant. The additional capital will enhance our ability to make the most of those identified opportunities.”
Dr Atkinson says great interest in the IPO has been shown by stakeholders who know the company. “Doctors, dentists, and pharmacists work with us on a daily basis and their stated intention to invest is very pleasing.”
“The board also appreciates that Capital Royalty Group (CRG) will be increasing its investment via a U.S. private placement that will occur simultaneously with the IPO. CRG is a specialist healthcare U.S. investment firm with US$2 billion under management. CRG is extremely selective about which companies they invest in. So for them to further increase their stake in AFT speaks volumes about the future direction of our business.”
Investors can participate through either the Broker Firm Offer or the Priority Offer, which open on Friday 4th December. Further information, including a link to AFT’s Product Disclosure Statement, can be accessed through the Offer website, www.aftpharmshares.com.
The Sole Lead Manager for the Offer is First NZ Capital.