U.S. private equity firm KKR & Co and its partners have revived plans to list non-bank lender Latitude Financial this year at a valuation of over $2.32 billion, after two failed attempts in the last three years, a source told Reuters.
The owners, who also includes Deutsche Bank and Varde Partners, on Wednesday signed a strategic alliance with Japan's Shinsei Bank that values Latitude at A$3 billion ($2.32 billion).
Shinsei, which last year acquired New Zealand's top non-bank finance provider UDC Finance from Australia and New Zealand Banking Group, would buy 10% of Latitude for A$300 million as part of the deal, the Tokyo-based lender said in a statement.
"Latitude is engaged in businesses similar to our group company APLUS Co., Ltd (and) has a business portfolio that is complementary to UDC," Shinsei said. "Through this alliance, Shinsei will strive to enhance its presence further in the Asia and Oceania region."
In late 2019, KKR and Varde, which before the Shinsei deal owned a 35% stake in the company each, and Deutsche, which had a 30% share, cancelled their second attempt at an IPO since 2018 because investors baulked at the price of about A$3.1 billion owners were asking for. [https://reut.rs/2OiBGwo]
After the deal with Shinsei, which includes a pro-rata sell-down by the trio of about 3% of the company each, the owners expect an IPO in the first half of the year would easily exceed its current valuation, according the person with knowledge of the plans.
The source requested anonymity because the plans were private and had not been finalised.
The Australian Financial Review on Thursday first reported the plans, saying Bank of America, Credit Suisse and Jefferies were appointed to manage the float, with selected investors expected to be briefed in meetings with management in coming days.
Latitude, Varde, KKR declined to comment on the revived IPO plans. Representatives for Shinsei and Deutsche Bank did not immediately return requests for comment.
A small 0.05% part of Shinsei's planned purchase needs to be approved by Australia's Foreign Investment regulator, Latitude said in a statement.
(Reporting by Paulina Duran in Sydney; Editing by Shri Navaratnam)
