Adore Beauty’s valuation raises eyebrows ahead of IPO

Quadrant has agreed not to sell more shares until the company releases its FY 2021 results.

Adore’s founders Kate Morris and James Height will earn $45.9 million each by selling 40 per cent of their holdings. Their individual stakes will fall from 19.3 per cent to 10.8 per cent each.

The founders’ remaining shareholdings will also be escrowed to prevent further sales, but for unspecified time periods.

Quadrant bought its 60 per cent stake in September 2019, leading some professional investors to ask why it has only waited just over a year to sell its ownership interest. The likely answer being that Quadrant believes now is a good time, given soaring e-commerce valuations.

On the plus side, Adore will still be led by its founders over the long term, with most great growth businesses on the sharemarket led by founders.

E-commerce star

On face value, Adore looks a retail star

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Adore Beauty lodges prospectus for $270 million ASX debut

a woman looking at the camera: Kate Morris Adore Beauty

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Kate Morris Adore Beauty

Aussie beauty marketplace Adore Beauty has lodged its prospectus with the Australian Securities and Investments Commission, as it heads for an IPO worth $269.5 million.

The offer values the business at $614.8 million, and gives it an opening market cap of $635.3 million, based on an initial offer price of $6.75 per share.

Adore Beauty will trade under the ASX code ABY.

In an Instagram post, co-founder and executive director Kate Morris, who launched the business out of her garage some 20 years ago, said she “would never, ever, EVER have dreamed that @adorebeauty would make it onto the ASX”.

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Well this has been one hell of a lockdown project!! 20 years ago in my garage, I would never, ever, EVER have dreamed that @adorebeauty would make it onto the ASX. I am so very proud

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Hipages expected to follow Adore Beauty’s lead for lower risk IPO

It is understood Hipages will look to raise $40 million through an issue of new shares for its IPO, while a shareholder selldown would account for another $50 million to $70 million.

The amount of the selldown depends on how much Hipages’ existing shareholders – including News Corporation’s News Pty Ltd, fund manager Ellerston Capital and venture capital firm Right Click Capital – sell into the transaction, which is yet to be determined.

GS says Hipages worth up to $370m

Sources said News Corp – which owns about 30 per cent of the business – was unlikely to be a big seller, while Right Click wanted to offload some of its stake.

Funds raised would help Hipages pay off $12 million in venture debt and help the company invest in its brand and products. The 200-person Hipages helps tradespeople generate business leads through an online marketplace but wants to expand

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