Nov 12, 2020

Dalrymple Bay coal port IPO to raise $656m

Dalrymple Bay coal port IPO to raise $656m

Brookfield Asset Management plans to raise at least $656 million in the initial public offering of the Dalrymple Bay Coal Terminal, in which it will sell a 51 per cent stake.

It comes after the Queensland Government this week confirmed it was taking a stake of almost 10 per cent in the Mackay region export facility amid plans for a $1.2 billion expansion.

The Queensland Investment Corporation (QIC) has signed a commitment for a 9.9 per cent stake in the Brookfield-owned facility. Documents showed that would cost $128 million, Reuters reported today

Brookfield’s minimum target of $656 million for the planned sale of 255 million shares works out to $2.57 per share.

Bids from institutional investors are due next Wednesday. A prospectus for retail investors is expected to be filed with the corporate regulator on November 20.

About half the proceeds will go to Brookfield, with the rest going towards the repayment of debt and transaction costs, according to the Reuters report.

The IPO – which was put on hold earlier in the year because of the coronavirus pandemic – is being managed by Merrill Lynch, Citigroup, and Credit Suisse, alongside retail brokers Bell Potter, Wilsons, and Ord Minnett.

Brookfield has flagged intentions to lift capacity at Dalrymple Bay Coal Terminal from 85Mtpa to 100Mtpa. The expansion works are expected to create about 500 construction jobs.