OpenMarkets IPO

Trading platform OpenMarkets is finalising its pitch for a $30 million initial public offering. If successful, the group’s shares would trade on the ASX on a normal settlement basis from July 23. OpenMarkets is understood to make about three-quarters of its revenue providing clearing and software for third-party brokers such as Superhero and SelfWealth, and has a direct-to-customer offering that allows customers to trade stocks and accounts for the rest. OpenMarkets Group consists of two enterprises. The first is OpenMarkets, which is the largest independent online broker and provides business-to-business tech solutions across wholesale execution, order and risk management, advice and customer relationship management to investment firms and fintechs. The second is OpenTrader, a self-directed retail trading platform for professional traders and those who want to trade in a sophisticated manner.

Key points:

• Unit Price: price would be $1.50 a share no matter what multiple stemmed from the bookbuild.
• Broker: E&P
• Use of fund: Funds raised would be used to repay debt, to invest in product and design and for other working capital.
• Valuaiton: At 4.5 times forecast 2022 financial year revenue, Openmarkets would be worth $112.8 million on an enterprise value basis, increasing to $125.4 million at 5 times. At the upper 5.5 times, it would be worth $137.9 million.
• Revenue: Its management expects about $25 million revenue in the upcoming financial year, and will seek to be valued off that number.