ComfortDelGro Corporation is no longer pursuing an initial public offering (IPO) for its Australian subsidiary.
ComfortDelGro had announced in August that it was considering listing its wholly-owned subsidiary, ComfortDelGro Corporation Australia (CDG Australia), on the Australian Stock Exchange subject to prevailing market conditions.
Since then, IPO conditions in Australia have become more challenging and other strategic options have presented themselves, says the company in a Nov 10 press release.
See: DBS lifts ComfortDelGro’s TP to $2.06 on the back of potential Australia IPO
In light of these developments, and on advice of the Joint Lead Managers, Credit Suisse (Australia) Limited and UBS Australia, the Group has decided to halt its IPO plans.
ComfortDelGro Chairman Lim Jit Poh says: “We had initially planned to list CDG Australia by the end of the year, subject to prevailing market conditions. The environment has changed somewhat since then so we are not proceeding with our IPO plans at this time. The intent is still to enhance the value of our Australian assets and we will carefully evaluate all strategic alternatives.”
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The IPO was originally planned for the last quarter of 2021. In August, ComfortDelGro said Australia is its single largest overseas investment destination with a total investment of $1.17 billion to-date. The Australian businesses generated revenue of $608 million for the year ended Dec 31, 2020.
ComfortDelGro, which currently operates in in six states and territories in Australia with a total fleet of over 4,400 vehicles including buses, coaches, and ambulances; will continue to focus on growing the business through mergers and acquisitions, contract renewals and new contract tenders.
