Brait SE is ready to list South African food maker Premier as soon as more favourable stock market conditions allow -- in what would be the first initial public offering on Johannesburg’s bourse since 2018.
The investment group has completed six to nine months of preparation work ahead of the deal, Peter Hayward-Butt, a partner at Ethos Private Equity, said in an interview. The maker of Blue Ribbon bread and Snowflake flour is valued at about R9.3-billion, according to Brait’s annual results published Tuesday.
“We’ve got our hand above the buzzer and we could push at any time we want to and when market conditions” are favourable, Hayward-Butt said.
Ethos became manager of Brait’s portfolio, which also includes gym chain Virgin Active and British clothing retailer New Look, following a 2019 restructuring of the company that counts billionaire Christo Wiese as a main shareholder.
A successful listing of Premier would be the first IPO on the JSE since food maker Libstar Holdings Ltd. in 2018, according to data compiled by Bloomberg. Yet a listing boom on global markets last year has given way to a period of severe market volatility, fueled by the war in Ukraine and interest rate rises to curb soaring inflation.
That’s made new share offers a harder sell, and some European candidates are trimming valuations or pulling deals. Only two IPOs have managed to raise more than $500-million in Europe so far this year.
Premier sales climbed 16% to R14.5-billion in the 12 months through March, while the company expanded with the acquisition of confectionery firm Mister Sweet.
Hayward-Butt is confident there will be “good demand for a company that’s performing well.” The money Brait raises from selling any portion of its Premier stake will be used to pay back its revolving credit facility, Hayward-Butt said.
“You’ll never time it to perfection, but if market conditions in the next month, two months or six months are there, we can proceed.”