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Mantra gains on ASX debut

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Hotel group Mantra rose 2.8 per cent on the first day of trade on the Australian Securities Exchange, following a $239 million initial public offering.

Mantra sold 132.8m new shares at $1.80 each in the offering last month, priced at 12.7 times 2015 forecast earnings with a fully franked yield of 5.5 per cent.

At 12:01pm AEST, Mantra shares were up 5 cents at $1.85, according to ASX data.

The firm, with brands including Mantra, Peppers and Breakfree, operates 111 properties and more than 11,400 rooms across Australia, New Zealand and Indonesia and is second only to Accor locally.

The company originally sought to raise $400m, with shareholders UBS and private equity firm CVC Capital selling off much of their stakes in the hotel and resort room manager. The IPO was later scaled back to $240m before being abandoned in March.

Under the revived share sale, CVC and UBS together retain a 43.3 per cent stake. New shareholders in Mantra will have a 53.3 per cent stake in the company, with the rest held by company management.

UBS and Macquarie were the joint lead advisors for the IPO, while Highbury Partnership acted as financial advisor.

(Reporting by maggie.lu@businessspectator.com.au)

(Editing by miranda.maxwell@businessspectator.com.au)

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Hotel group Mantra shares rise 2.8 per cent after $239 million IPO.

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