KKR consortium cancels biggest Australian Latitude IPO, says report

US private equity firm KKR & Co and its partners have cancelled what was expected to be the biggest Australian IPO of the year, the listing of their lender Latitude Financial, two sources told Reuters.

In what was to be their second attempt at listing in just over a year, KKR, Deutsche Bank and Varde Partners, decided to cancel the expected A$1 billion ($676.20 million) offering on Tuesday, because a large proportion of demand for shares was coming from hedge funds rather than desired long-term investors, the sources said. The sources had direct knowledge of the situation but asked not to be identified since they are not authorized to talk to the media. A Latitude spokesman declined to comment but said the company expected to make an announcement on Wednesday.

Latitude had filed a prospectus with the regulator last month valuing the finance company at between A$2 and A$2.25 per share but over the weekend decided to discount the offer price by up to 20.9 per cent due to low demand, Reuters reported.

 The firm, which offers easy-access loans and credit cards with minimal paperwork, and its bookrunners were due to finalise the raising on Wednesday and shares in the new company were due to begin trading Oct  18. reuters