Firmus cuts IPO offer price to as low as A$8 as float faces uncertainty

Nvidia- and Blackstone-backed data centre operator Firmus Technologies is scrambling to keep its initial public offering on track after cutting the offer price to as low as A$8 per share from the original A$11, the Australian Financial Review reported, according to Reuters Breakingviews on Thursday.

The company is trying to hold the price at A$8.25, the AFR said. At that level, assuming the number of shares sold stays the same, the offer would raise A$5.9 billion ($4.1 billion) instead of A$7.9 billion, and Firmus’s equity value would fall to A$33 billion from the almost A$44 billion it had been aiming for.

Reuters reported on October 5 that the company was allocating around half of the IPO to existing investors. Its shares are expected to start trading on October 23.

The bookbuilding closed on Thursday morning in Australia, as scheduled, without a clear indication of the price or the deal structure, the Business Times reported, citing people familiar with the matter, who said some investors were concerned the deal could be pulled. The company had been seeking US$5.5 billion including a greenshoe option.

The NZ Herald called the listing, billed as Australia’s biggest capital raise since Telstra, “less certain”. Backer Maas Group Holdings, which holds 3.2 per cent of Firmus, tanked by more than 24 per cent on the reports, AAP reported — the Business Times put the fall at as much as 30 per cent, the most on record.

Sources

• Reuters Breakingviews: Shaky $4 bln neocloud IPO pricks AI bubble
• Business Times: Nvidia-backed Firmus said to close books as mega IPO struggles
• NZ Herald: Firmus IPO faces uncertainty as offer price cut and float may be pulled – Stock Takes
• AAP: Australian shares slump as miners tumble, Maas crumbles