(Alliance News) - Singapore-based agricultural giant Olam International on Friday said it has chosen London for the initial public offering of its food ingredients business.
Olam is in the process of demerging its two units - Olam Food Ingredients and Olam Global Agri. OFI supplies ingredients and products made from cocoa, coffee, nuts, spices, and dairy. The IPO is planned for the first half of 2022 and will be joined by a secondary listing on the Singapore Stock Exchange.
OFI is planning to raise about GBP2 billion, Reuters reported on Friday, citing sources familiar with the matter. Citigroup , Credit Suisse, HSBC Holdings, JPMorgan Chase and Morgan Stanley have been appointed to work on the IPO, according to Reuters.
In the first half of 2021, OFI made revenue of SGD6.8 billion - about USD5.0 billion - and earnings before interest and tax of SGD316.3 million.
Olam International is currently listed in Singapore, with a market capitalisation of SGD5.59 billion, equivalent to USD4.11 billion. It is controlled by the country's sovereign wealth fund, which has a 54% stake.
The Global Agri unit, which supplies animal feed, rice, palm oil and cotton, is the larger of the two units. It made SGD15.5 billion revenue and SGD407.5 million profit in the first half.
OFI Chief Executive Anantharaman Shekhar said: "The primary listing on the LSE will give us access to London's large and diverse investor base, with its deep and liquid capital markets, and enable us to benefit from its strong understanding of and research coverage across the food and beverage sector.
"Our integrated global network, servicing large, attractive and growing end-use categories, within an expanding on-trend ingredients portfolio, makes us a compelling investment case for anyone looking to tap into growing global demand for food that is healthier, traceable and sustainable."
Here is what you need to know at the London market open:
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MARKETS
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FTSE 100: up 0.3% at 7,213.21
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Hang Seng: down 0.8% at 26,318.45
Nikkei 225: closed down 0.1% at 27,977.15
DJIA: closed up 14.88 points at 35,499.85
S&P 500: closed up 0.3% at 4,460.83
Nasdaq Composite: closed up 0.4% at 14,816.26
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EUR: firm at USD1.1736 (USD1.1729)
GBP: down at USD1.3805 (USD1.3829)
USD: unchanged at JPY110.35
Gold: up at USD1,758.53 per ounce (USD1,750.13)
Oil (Brent): down at USD70.71 a barrel (USD71.22)
(changes since previous London equities close)
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ECONOMICS AND GENERAL
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Friday's Key Economic Events still to come
1100 CEST EU foreign trade
0830 EDT US import & export price indexes
1000 EDT US University of Michigan survey
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China rejected the World Health Organization's calls for a renewed probe into the origins of Covid-19, saying it supported "scientific" over "political" efforts to find out how the virus started. Pressure is once more mounting on Beijing to consider a fresh probe into the origins of a pandemic which has killed more than four million people and paralysed economies worldwide since it first emerged in the central Chinese city of Wuhan. A WHO team of international experts went to Wuhan in January 2021 to produce a first phase report, which was written in conjunction with their Chinese counterparts. It failed to find a conclusive position on how the virus began. On Thursday the WHO urged China to share raw data from the earliest Covid-19 cases to revive its probe into the origins of the disease. China hit back, repeating its position that the initial investigation was enough and that calls for further data were motivated by politics instead of scientific inquiry.
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BROKER RATING CHANGES
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JPMORGAN RAISES DELIVEROO PRICE TARGET TO 393 (337) PENCE - 'NEUTRAL'
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BERENBERG CUTS STOCK SPIRITS TO 'HOLD' (BUY) - PRICE TARGET 377 (326) PENCE
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COMPANIES - FTSE 250
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Babcock International said it has reached an agreement with US science and technology company KBR to sell its subsidiary Frazer-Nash Consultancy for GBP293 million. Babcock said the sale forms part of its disposal programme, which aims to generate at least GBP400 million over the next twelve months. Babcock said Frazer-Nash Consultancy is an "outstanding business" which provides independent advice to its customers and has operated largely independently from Babcock. Cash from the sale will be used to reduce net debt. "We are making real progress on our plan to streamline and focus the group on our key markets. Divesting at least GBP400 million of businesses in our targeted disposals programme will enable us to reduce complexity and increase our focus as we return Babcock to strength," said Chief Executive Officer David Lockwood.
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Avon Protection said it has continued to see good commercial progress in the second half of financial 2021, but lowered its annual revenue guidance. Its financial year ends in September. The company, formerly known as Avon Rubber, said order intake in the ten months to July 31 was USD221 million. This represents order growth, excluding its US helmet business Team Wendy, of 13% from the same time last year, giving a strong order book of USD146 million. When including recent acquisition Team Wendy, order growth was up 21% year-on-year. However, Avon said delays in the receipt of orders, supply chain disruption and a tight US labour market has increased significantly through the second half of the financial year. Avon said that, although it expects this Covid-19 related disruption to be temporary, it has resulted in a reduction in revenue guidance for financial 2021 to between USD245 million to USD260 million. The company posted revenue of GBP168.0 million for the year ended September 30.
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COMPANIES - MAIN MARKET AND AIM
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Coal producer Thungela Resources posted a significant increase in interim earnings as it reported for the first time as an independent company, having been spun off from Anglo American earlier this year. For the six months to June 30, revenue jumped to ZAR10.05 billion from ZAR1.66 billion last year, and it swung to a profit of ZAR351 million from a ZAR122 million loss. Its operating profit surged to ZAR1.89 billion from ZAR52 million. Thungela Resources said it was cash positive and well positioned after the spin-off and expects positive adjusted operating free cash flow for rest of 2021. As a result, it expects to declare maiden dividend at 2021 annual results at 30% of adjusted operating free cash flow. "We are pleased to note the recent recovery of global thermal coal prices. These are reflective of the continued demand for high-quality coal amid challenging supply dynamics across many regions," said CEO July Ndlovu.
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COMPANIES - GLOBAL
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Berkshire Hathaway-backed fintech firm Nu Pagamentos is planning a USD2 billion initial public offering for the end of this year, Bloomberg reported. The firm, known as Nubank, may seek a valuation of USD40 billion in a Nasdaq listing, Bloomberg reported citing people familiar with the matter. Banks handling the share sale include Morgan Stanley, Goldman Sachs, Citigroup and UBS. The Sao Paulo, Brazil-based company is also backed by Advent International and Tencent Holdings. Deliberations are ongoing, Bloomberg added.
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Friday's Shareholder Meetings
iEnergizer Ltd - AGM
NewRiver REIT PLC - GM re community pub business sale
System1 Group PLC - AGM
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By Tom Waite; thomaslwaite@alliancenews.com
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