KKR-Backed Pepper Money Expands Australia’s Biggest IPO of 2021

Australian non-bank lender Pepper Money Ltd. increased the size of its initial public offering Thursday, making the country’s biggest offering so far this year even larger.

Citing strong demand, the KKR & Co.-backed business upsized its IPO by A$50 million ($38.7 million) for a total of A$500 million, according to terms of the deal seen by Bloomberg News.

Existing investors such as KKR and management will own nearly 61% of the company following the offer, the terms showed. Banks stopped taking orders from institutional clients at 3 p.m. Sydney time, two hours earlier than planned.

The upsizing highlighted the strength of investors’ appetite for new listings, after Australian firms priced nearly $2.3 billion of IPOs so far in 2021, the most year-to-date since 2007, according to data compiled by Bloomberg.

The deal is one of two involving KKR’s portfolio companies in the country’s market this week. On Monday, Australian Venue Co., a pub operator also backed by the firm, launched an offering to raise A$352 million.

Pepper’s offer of shares set aside for professional investors had already been brought forward to Wednesday and was fully subscribed, Bloomberg News reported earlier. Credit Suisse Group AG and Goldman Sachs Group Inc. are joint global coordinators for the IPO. Royal Bank of Canada and KKR Capital Markets are joint lead managers.

Shares of Pepper are set to begin trading on the Australian Securities Exchange on May 27.

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