Following its successful IPO, the non-bank was today admitted to the official list on a conditional and deferred settlement basis.
At 12.30pm AEST today (25 May), Pepper Money (Pepper) began trading on the Australian Securities Exchange, the ASX, under the ticker code PPM.
Commencement of trading on ASX on a normal settlement basis is expected on Thursday (27 May).
Under the IPO, the company will issue 173.2 million new shares at an offer price of $2.89 per share to raise cash proceeds of $500.1 million.
Following completion of the IPO, the company will have 439.5 million shares on issue and a market capitalisation of approximately $1.3 billion at the offer price.
Pepper Money CEO Mario Rehayem said: “I would like to welcome our new shareholders to the register. We have been delighted with the support and interest we have received throughout this process from a wide range of institutional and retail investors.
“We will continue to focus on growing our business and to deliver on our purpose of helping people to succeed by concentrating on underserved customer segments via our multi-channel distribution channel and cascading credit model.”
According to the non-bank lender, funds raised by the IPO will be used to provide financial flexibility to pursue further growth opportunities and strengthen Pepper Money’s balance sheet by enabling the partial repayment of an existing bridge facility and partial repayment of the existing shareholder loan.
The non-bank currently has approximately $15 billion in assets under management from $32.3 billion of originations, including $10.7 billion in outstanding mortgage loans to customers originated or acquired by Pepper Money, $2.6 billion in asset finance loans and $1.7 billion in loans that Pepper Money services for third-party clients.
The lender was previously listed, before it was bought by KKR in 2017.
KKR and the Pepper Group (the TopCo entity) will retain 60 per cent of the shares in the company.
Speaking to Mortgage Business earlier this month, Pepper Money CEO Mario Rehayem said the listing gives Pepper the ability to “really widen our product, widen our distribution networks, and really showcase the strength of this business with a really wide and astute investor shareholder base that we’ve been able to put together during this IPO process”.
“Listing give us more opportunities to not only gain capital from from the market, but outside of that, it’s about continuing to grow the way we’ve grown over the past 20 years, continuing to fill the void in the market of those underserved segments, and continuing to deliver market-leading turnaround times with the latest digital platforms that we’ve been able to develop over time.
“So, it really is just strengthening the balance sheet, and doing what we’ve done well for the last 20 years,” he said.
The ASX welcomed the non-bank in a tweet, stating:
ASX welcomes PPM. Pepper Money is a non-bank lender focused on underserved customer segments. They currently offer three broad categories of products including mortgages, asset finance and loan and other servicing. Congrats. https://t.co/WiL4mcwjJA #ListASX @peppermoney #ausbiz pic.twitter.com/QvitSQJVWf— ASX 🏛 The heart of Australia’s financial markets (@ASX) May 25, 2021
[Related: Pepper Money to list on the ASX]
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Annie Kane is the editor of The Adviser and Mortgage Business.
As well as writing about the Australian broking industry, the mortgage market, financial regulation, fintechs and the wider lending landscape – Annie is also the host of the Elite Broker and In Focus podcasts and The Adviser Live webcasts.