Australia's Link slides on rejecting KKR's bid in favour of listing PEXA

(Reuters) -PEXA’s top shareholder Link Administration Holdings Ltd said on Monday it would take the online real estate company public, after KKR & Co’s takeover bid for the unit fell through.

Shareholder registry firm Link’s stock slipped 3.5% in early trade.

Sources told Reuters on Saturday PEXA had raised $907 million in an underwritten initial public offering (IPO) at A$17.13 per share, making it Australia’s largest this year.

Last week, U.S. private-equity giant KKR had offered more than A$3 billion for PEXA in a consortium with Domain Holdings Australia, conditional on Link scrapping plans to list the company.

Property classifieds operator Domain said on Monday it was no longer bidding for a 10% stake after being notified that PEXA’s sale process had been dropped.

Link said that retaining exposure to its interest in PEXA whilst also realising a transparent valuation through a listing and flexibility to monetise its interest over time was in the best interests of shareholders.

PEXA will start trading on the Australian stock exchange towards the end of June and have an enterprise value of A$3.3 billion ($2.54 billion), Link added.

The company had expected to get about A$50 million in cash from the IPO and its stake in PEXA to increase to 47% from 44.2%.

However, Morgan Stanley Infrastructure Partners had sold its 40% holding in PEXA, while Commonwealth Bank of Australia raised it slightly, the sources told Reuters.

Link had set a June deadline for bidders for PEXA as it evaluated a trade sale or an IPO for the firm, which has grown rapidly due to a booming Australian property market and a shift to digital channels amid the pandemic.

($1 = 1.2970 Australian dollars)

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