In the AFR 16/8/2020.

Ratesetter's fresh lick of paint scores Plenti-ful $275m deal

It's risk on as far as small cap floats are concerned – just ask non-bank lender Plenti. While most of the market was focused on profit results last week, Plenti was quietly locking in cornerstone backers for a $50 million initial public offering valuing it at about $275 million. It is understood the cornerstone backers mopped up about half of the IPO and included institutional investors like Wilson Asset Management, Regal Funds Management and Washington Soul Patts. The rest of the IPO will be marketed by lead managers Bell Potter and Wilsons and sold at a bookbuild slated for later this week. Plenti, chaired Mary Ploughman and founded by Daniel Foggo (back left), Glenn Riddell (middle) and Ben Milsom, has secured cornerstone backing for its sharemarket float.

Never heard of Plenti? Neither had the cornerstones until last week. It's the new name for what was RateSetter, the fintech that has lent more than $800 million to Australians via secured and unsecured personal, car, green and legal loans in the past five years or so. Foggo, advised by Highbury Partnership, told cornerstone backers Plenti's business had proven resilient through COVID-19, with its revenue growth up more than 60 per cent a year since 2018 (on a compound annual growth rate basis). And the investors bought his pitch that the technology powering its lending platform and the nature of its loan book meant that growth is set to continue. Co-founders Foggo and Glenn Riddell will retain about a 27.5 per cent stake on listing. The company is chaired by ex-Resimac Group joint CEO and former Macquarie banker Mary Ploughman. Bell Potter and Wilsons were due to blast full terms and details around the market and their own broker networks on Monday morning, to kick off a (virtual) IPO roadshow.

Should the deal get done, it would be a bullish sign for Australia's IPO market and particularly those float contenders that can show a positive story out of the COVID-19 pandemic and strong forecast (and historical) growth. While earnings season has shown plenty of companies struggling at the big end of town, there's been investor demand for new microcap listings including Aroa Biosurgery, 4DMedical and Laybuy.

FINIS