Australia’s IPO market pins hopes on Virgin’s return, Molycop

Australia is relying on two billion-dollar listings to save it from the worst year on record for initial public offerings. Companies have only raised about A$885m ($572m) through first-time share sales in the country so far in 2023, according to data compiled by Bloomberg. This comes after 2022, which was itself the slowest year for IPOs down under since 2012, with just A$1.1b raised. The eerily quiet IPO market means bankers are pinning their hopes in airline Virgin Australia Airlines Pty Ltd. and metals processor Molycop, which could raise A$2b in total should they proceed with their listing plans this year. While the duo have met prospective investors as part of their IPO preparations, it remains uncertain whether they will launch the deals before the end of 2023. “It’s been a really challenging year, we’ve seen a real drop off in activity,” Marcus Ohm, a partner at accounting firm HLB Mann Judd, said in an interview. “IPOs are expensive affairs so if you’re going to go down this path, you’ve got to be really confident you’ll have a successful bookbuild. For these larger companies it’s also a reputational issue if it all falls over.” Bain Capital, the owner of Virgin Australia, is closely watching the latest earnings season in Australia before rolling out more investor briefings for the IPO, the people said. Qantas, Virgin’s biggest domestic competitor, is buying more aircraft in a bid to keep pace with a post-pandemic travel boom that’s delivering record profits.<br/>