Ventia (ASX:VNT) shares are listing on the ASX today. Here’s what you need to know

Here are all the details on Ventia’s IPO

construction worker celebrates success in a tunnel

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The ASX is set to get a new face today as Ventia Services Group Limited (ASX: VNT) debuts on the market.

The bell is set to ring on Ventia’s initial public offering (IPO) at 1pm AEST Friday.

Here’s what you need to know about the upcoming float.

But first, what is Ventia?

Ventia is an essential maintenance services provider working in the infrastructure sector.

Over calendar year 2020, the company brought in $4.6 billion of revenue, around 40% of which came from regional and rural areas.

Some 85% of the company’s revenue was from Australia, while 15% was from New Zealand.

In Australia, Ventia services 50% of private motorways and tunnels, more than 70% of defence sites, and is the top telecommunications infrastructure services provider.

In New Zealand, the company services more than 90% of the electricity network.

Ventia believes it had a total addressable market worth $62 billion as of financial year 2021.

Ventia’s IPO

Under Ventia’s prospectus, shares in the company were sold for $1.70 apiece.

That offer price was lower than the company’s earlier prediction that it would sell its shares for between $2.75 and $3.15 each.

Despite the lower pricing, Ventia’s IPO still brought in $438 million.

Some $374 million of that – around $351.1 million after costs – came from the sale of shares. The other $64 million was raised by the company’s owners selling some of their stakes.

However, Ventia’s biggest shareholders by far will still be owners, Cimic Group Ltd (ASX: CIM) and Apollo Global Management (NYSE: APO). They will each hold a 32.8% stake.

Ventia expects to float with a market capitalisation of around $1.45 billion.

What’s next for the ASX newbie?

Here is a breakdown of the company’s forecasted income for calendar year 2022:

The company is also forecasting a dividend yield of 8.9%.

That figure is based on an assumed $1.70 share price and 75% payout ratio on its forecast revenue for calendar year 2022.

Should you invest $1,000 in Ventia right now?

Before you consider Ventia, you'll want to hear this.

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Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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