PropertyGuru lodges IPO prospectus to raise up to A$380m on ASX

Singapore

SOUTH-EAST Asian real estate portal PropertyGuru, which counts buyout firms TPG Capital and KKR among its backers, is seeking to list on the Australian Securities Exchange (ASX).

In a prospectus lodged on Monday, the Singapore-based property technology (proptech) firm gave an indicative price range of A$3.70 to A$4.50 per share for the initial public offering (IPO).

Assuming the final price is at the midpoint of the range, the IPO will raise A$362.6 million (S$338.1 million), PropertyGuru said in a statement on Monday. The low end of the range works out to a total of A$345 million while the high end translates to A$380.2 million.

The retail offer is expected to open on Oct 16 and close on Oct 22. The final price will be announced to the market on Oct 24.

About 30.1 per cent to 32.2 per cent of the company will be held by new investors plus existing investors who are not subject to voluntary escrow deeds, at the completion of the offer, according to the prospectus seen by The Business Times.

Based on the midpoint of the indicative range, TPG and KKR will hold a 26 per cent and 23.3 per cent stake, respectively, at the IPO's completion. TPG and KKR currently hold 30.4 per cent and 27.25 per cent, respectively.

The indicative market capitalisation will range from A$1.16 billion to A$1.36 billion.

PropertyGuru runs digital property classifieds marketplaces in five countries across South-east Asia: Singapore, Vietnam, Malaysia, Thailand and Indonesia. The group has an average 60 per cent market share across these five core markets, it said on Monday.

Asked why PropertyGuru decided to list on the ASX despite not having businesses in Australia, a company spokesman declined to comment.

PropertyGuru did not announce any plans to expand into Australia. In the prospectus, Australia and the UK were cited as examples of developed markets, in contrast to its South-east Asian markets which are still in the early stages of offline-to-online migration for real estate advertising.

Part of the IPO proceeds will be used to pursue the company's growth strategy, which includes potentially developing data offerings to customers, as well as creating an online mortgage marketplace to provide property seekers in its core markets with access to mortgage financing, said chief executive officer Hari Krishnan.

The prospectus states that PropertyGuru is likely to start with developing online mortgage marketplace products in Singapore and Malaysia.

In a statement, the company said its pro forma revenue has grown at a 26 per cent compound annual rate over the last three years. In 2018, PropertyGuru became Ebitda (earnings before interest, tax, depreciation and amortisation) positive and also free cash flow positive.

Chairman Olivier Lim said the market opportunity for online property advertising in its core markets is underpinned by strong population growth, urbanisation, increasing Internet penetration, greater access to mobile phones and rising wealth levels leading to the expansion of the middle classes.

Mr Krishnan said PropertyGuru has established a strong market position in the South-east Asian property ecosystem, thanks largely to its investment in technology and digital innovation. The firm has developed proprietary scalable technology platforms using artificial intelligence and augmented reality.

PropertyGuru's portfolio includes the online classifieds marketplaces, a regional property awards business, and a sales automation solution for property developers.

For the IPO, Gilbert & Tobin is the Australian legal adviser, while Allen & Gledhill is the Singaporean legal adviser. The joint lead managers are Credit Suisse, UBS, KKR Capital Markets and TPG Capital BD. The offer is not underwritten.