demand explodes for dyno

http://sg.biz.yahoo.com/060405/15/3zv0t.html

IPO

Wednesday April 5, 9:26 AM
UPDATE: Demand Explodes For Dyno Nobel's Australian IPO

MELBOURNE (Dow Jones)--The initial public offering of the world's second-largest explosives company, Dyno Nobel Ltd. (DXL.AU), got off to a good start Wednesday with heavy demand pushing up the top end of its indicative share price sale range.

The price range offered to institutions for one of the largest new listings in Australia this year has been raised to A$1.89-A$2.37 from A$1.89-A$2.27 because of strong demand, a banking source told Dow Jones Newswires.

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Macquarie Bank Ltd. (MBL.AU) is selling 464.6 million shares, or a 57% stake, in the Sydney-based company, which at the top of the price range would have a total market capitalization of A$1.93 billion.

Already ranking as the largest explosives maker in North America, Dyno Noble hopes to lure investors at a time when base metal prices are near record highs and mining companies are hitting labor and other shortages as they seek to boost output.

"There's been massive demand from domestic and international institutions," the source said.

The sale of Dyno Nobel, which competes with Australia's Orica Ltd. (ORI.AU), is being organized by Credit Suisse (CSR) and Macquarie Bank.

A consortium including Macquarie Bank and nine others bought Norway-based Dyno Nobel Holding ASA from Stockholm-based private equity company Industri Kapital AB (IKL.YY) for US$1.7 billion (A$2.35 billion) in September.

The Macquarie-led group retained Dyno Nobel's businesses in Australia, New Zealand, Canada and the U.S., and sold its European, Asian, African, Middle Eastern and Latin American units to Orica, the world's largest explosives maker, for $US685 million.

Dyno Nobel Chief Executive Peter Richards said last month Macquarie Bank will retain a 4% stake in the company, while Dyno Nobel management will hold a 1% stake.

Dyno is expanding its unit in North America where it is the market leader with 40% of the market ahead of Orica with 30%.

The company is spending US$90 million over two years to expand output at its plants in North America and Australia, where it focuses on the Pilbara iron ore mining region in Western Australia state and the Bowen Basin coal mines in Queensland state.

Dyno Nobel will concentrate on its existing territories and plans to focus on expanding sales in Asia and Latin America through existing clients, Richards said.

Its shares are due to start trading on the Australian Stock Exchange on Friday.