Remember This one some of the regulars here would be very familiar. Champ invested up to $200 Mil in this last year. Now it may come back as an IPO in 2017. Could be a good one.
Pepperstone float back on agenda for Champ Private The Australian 12:00AM September 14, 2016 Champ Private equity is considering revising attempts to float Pepperstone next year after the buyout firm recently swallowed the foreign exchange trader in a deal thought to have been worth between $100 million and $200m.The move comes after Pepperstone planned to float on the ASX last year through advisers UBS and Citi as a business worth between $500m and $600m.This was after competitor OzForex drew valuations of more than 20 times forecast profit.
However, Pepperstone later shelved the float amid controversy surrounding the Swiss franc after a cap on the exchange rate was dropped.
While investment banking advisers are yet to be formally appointed to Pepperstone, it is tipped Champ and the company’s founders, Owen Kerr and Joe Davenport, will call on the services of Citi and UBS to execute the deal, should it proceed. Pepperstone currently offers platforms for both retail and institutional clients, transacting more than $US100 billion ($132.7bn) in FX turnover each month. It has offices in Melbourne, Shanghai and Dallas. In June, when the deal with Champ was executed, Owen Kerr described the buyout firm as a significant investor and business partner, adding that the plan was to take
Pepperstone to a much higher level in the years ahead.
In the past year, there has been surging interest in foreign exchange businesses as takeover targets, with Western Union making an $888m offer for the strongly performing listed online foreign currency broker OzForex late last year.
But the stock later slid from above $3 to below $2.30 after the suitor walked away. More than a year ago, Pepperstone was described as a rapidly expanding foreign exchange broker based in Melbourne, with aspirations to expand deeper into the Chinese market. This was after staging an exit from Japan — where it generated about 40 per cent of its revenue — due to the loss of its licence.
At the time, the business ranked as the 12th-largest foreign exchange trader in the world and the market value was considered to be somewhere between $500m and $600m.
Kerr and Davenport are both in their 30s and have racked up multi-million-dollar fortunes, along with numerous awards since founding Pepperstone in 2010. Last year, the two were reported to have extracted $32m in dividends from the company, Pepperstone’s operation in China was on track to account for about 30 per cent of its revenue by the end of 2015, and it had European expansion plans, the company said at the time.
