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Johannesburg - Rhodes Food Group raised $107m in an initial public offering (IPO) priced in the middle of an earlier indicative range, it said on Friday.
At that price, the IPO would give the maker of frozen food and prepared meals a market capitalisation of R2.6bn when it lists next Thursday.
Rhodes supplies major retailers such as Woolworths [JSE:WHL], Pick n Pay [JSE:PIK] and Shoprite [JSE:SHP] with jams, pastries and sausage rolls and sells canned citrus in Britain. It competes with Tiger Brands [JSE:TBS] and Pioneer Food Group [JSE:PFG].
The company reported a more than one-third rise to R1.8bn in revenue in the nine months to end-June, while core profit, or EBITDA, increased by the same margin to R195m.
Rhodes, which had set the IPO price in a range of R10.50 and R13.50, sold 102 million shares million at R12 each, raising R1.2bn.
The IPO included a follow on offer, or overallotment option for underwriters, of about 9 million shares, aimed at stabalising the price and preventing it from going below the offer price.
The offer comprised of 50 million shares issued by the company to raise R600m rand to pay down debt and another 43 million shares from shareholders cashing out.
Morgan Stanley, FirstRand's Rand Merchant Bank [JSE:FSR] unit and Renaissance Capital have been appointed joint coordinators and bookrunners.
