IPO - Craveable Brands, page-12

Anddd...another one bites the dust!

http://www.copyright link/street-ta...blic-offering-shelved-sources-20170623-gwx4ks

Craveable Brands initial public offering shelved: sources
Archer Capital has shelved its initial public offering plans for Craveable Brands, Street Talk can reveal.

Sources cited uncertain market sentiment; this week's profit downgrade from food and coffee franchisor Retail Food Group; and a bearish research note on Domino's Pizza from Citigroup on Wednesday.

Archer Capital had been seeking to raise about $250 million at $2.09 to $3.07 a share. An institutional bookbuild was scheduled for next week.to determine the final price.

Craveable Brands' brokers Goldman Sachs and Morgan Stanley told fund managers during last week's initial public offering roadshow that the float would come to market at 11.5-times to 12.5-times profit, on a 2018 financial year P/E basis.

The 11.5-times to 12.5-times NPATA range equated to an 8.6 per cent to 9.3 per cent dividend yield, which it was hoped would appeal to the retail investor market.

The price range was also at a slight discount to the already listed fast food company Collins Foods, which makes most of its money from KFC franchises in Queensland and NSW.

Collins is trading at 13.2-times forecast profit.

However, as Craveable Brands chief executive officer Brett Houldin had been at pains to point out to fundies, there is a significant difference between his company and the ASX-listed incumbent.

Collins Foods is a franchisee business of KFC, while Archer Capital's Craveable Brands is the franchisor of about 570 restaurants across its Red Rooster, Oporto, and Chicken Treat brands.

Meanwhile, Craveable Brands had been pitched as a high EBITDA margin, capital light and strong cash flow comparative.
Craveable Brands has a network of 561 fast food restaurants in Australia and eight in New Zealand, with network sales expected to be worth $786 million in the 2018 financial year.