Fast food retailer IPO falls on trading debut
Australia’s biggest public float in the past few months, Collins Foods, fell 8 percent on its first day of trading.
Collins Foods is a KFC franchisee that operates all 117 KFC outlets in Queensland and 85 Sizzler restaurants worldwide.
The company’s owner Pacific Equity Partners, a private equity firm, sold its 52 percent stake, and the company successfully raised $202 million in an initial public offering at $2.50 a share last month.
However, the stock opened at $2.48 yesterday before finishing at $2.30, presenting an 8 percent fall. The Australian market also fell 1.3 percent for the day. Collins Foods shares were down a further 8.7% this morning to $2.10.
Collins Foods expects to use most of the money raised from the public offering to pay down debt. The company also has plans to open new stores and refurbish its existing stores.