Mantra IPO cancelled

Mantra Group has cancelled its $400 million initial public offering indefinitely.

Joint lead managers UBS and Macquarie Capital along with Mantra management cancelled the float last week after the bankers lowered the offer price by up to 30 per cent on a heavily reduced $239.1 million equity.

The IPO was expected to be one of the biggest so far this year, however some fund managers questioned the group’s outlook ahead of listing over weak signs of improvement in revenue per room metrics across the hotel industry.
Mantra operates Mantra, Breakfree and Peppers brands and is second only to the giant Accor in the local hotel market.

The group owns a portfolio of 111 properties and more than 11,400 rooms across Australia, New Zealand and Indonesia, and generates about $450 million in revenue annually, and earnings of about $62 million.
The group’s exposure to markets in Adelaide, Perth and Brisbane was also questioned.

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