Scales tips July IPO

Scales managing director Andy Borland.

Christchurch-based agribusiness company Scales Corp said it was considering an initial public offering and a listing on the NZX, which it said would involve majority shareholder Direct Capital selling down its stake and the raising of fresh capital.

The company, which was once part of failed finance company, South Canterbury Finance, said it expects to list on the NZX in July.

Scales is currently 84 per cent owned by Auckland-based private equity investor Direct Capital, through its Direct Capital IV and Pohutukawa II funds along with co-investment partners, the New Zealand Superannuation Fund and ACC.

The balance is held by senior management team members and 400 external investors.

Direct Capital intends to sell down a portion of its current shareholding in Scales, but is looking to retain a cornerstone shareholding, Scales said.

A prospectus is expected to be available in mid-June and the company expects the shares to be quoted on the NZX main board in late July, it said.

Scales - one of New Zealand's oldest companies - is involved in the apple growing, packing and exporting business, logistics, storage and in food ingredients.

Scales is one of many companies that are considering an IPO to take advantage of the buoyant conditions for equities.

Since the start of 2013, the New Zealand market has rallied by more than 1,100 points, or 27.5 per cent, on the benchmark NZX50 index.

The local market has benefited from improved growth prospects at a time when there's been plenty of cash roaming the world trying to find better returns than the current, abnormally low, interest rates.

Joint lead managers for the Scales offer are Deutsche Craig and First NZ Capital.

See the Scales IPO announcement here