CWH float delayed… again?

The latest speculation on Chemist Warehouse’s rumoured initial public offering sees a potential deal delayed till 2022

While at the end of 2020 finance pundits were suggesting that Chemist Warehouse might by readying for an initial public offer in early 2021, it now appears that these plans may have been delayed again.

At that time, The Australian Business Review Dataroom editor Bridget Carter suggested that an up to $6bn float could be imminent, with the discount giant “understood to be asking investment banks to pitch in the first quarter of next year for a role floating Australia’s largest pharmacy chain”.

She said that her sources suggested proposals from bankers could be finalised by March for either a sale, or a float of the group.

Speculation about the potential float of Chemist Warehouse has been ongoing for some time.

Mid-2020 Ms Carter suggested that Wesfarmers could be courting the group; in August 2019 the Australian Financial Review’s Street Talk column linked Rothschild Australia to the discounter.

The AFR was suggesting “a potential run at the ASX-boards” in November 2017.

Now, Ms Carter writes in Dataroom that, “The $5bn-plus Chemist Warehouse is believed to have further pushed back plans for its initial public offering, with some now saying that a deal may not happen until next year”.

She writes that sources have told her the discount giant is “in no rush to list and is not in any urgent need of funds,” again underlining Rothschild’s work with the group preparing it for a listing.

She suggests factors to do with the COVID-19 pandemic could be delaying a float, with the daigou trade lapsing… “although some close to the situation say trade from Chinese online shoppers only amounts to a small part of the Chemist Warehouse business”.

“The company is thought to have generated about $4bn in sales and $250m of earnings.”

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