Investors will be eager to better understand John McGrath’s intentions for his shares in his real estate chain before throwing their support behind the initial public offering plans for the business.
Management and joint lead managers, who include JPMorgan and Bell Potter, briefed fund managers about the company this week. Some worry that they may be buying into a real estate chain at what could be the peak of the property market.
McGrath Estate Agents, which is advised by Luminis, is believed to be using US-based agency firms as comparables.
The motivation behind its listing plan is said to be its desire to own multiple broking groups under more than one brand, as part of its roll-up strategy.
Some investors will want some evidence that the company-founding chief executive will be backing the deal by retaining a majority of his stake in the deal.
The group, with 62 offices in NSW, Queensland and the ACT, is aiming to raise $100 million ahead of listing a company with a market value of about $200m.