Australia's largest automotive parts supplier to mechanics and trade customers, Burson Group, made an impressive debut on the Australian Securities Exchange on Thursday with opening trades at a 12.6 per cent premium to its issue price.
Burson shares began trading at $2.05 each when the company listed on the ASX at midday - above its issue price of $1.82 - as it began life as a $330 million-plus public company after being in the hands of private equity firm Quadrant, which is retaining a smaller stake of 19.9 per cent.
Burson sells more than 500,000 different car parts from its network of 114 stores to independent mechanics and chains including Ultra Tune, Midas and Kmart Tyre & Auto.
The customer base consists of about 30,000 different workshops, which rely on speedy deliveries of replacement parts for vehicles they are servicing and repairing. Burson chief executive Darryl Abotomey said he was pleased with the sharemarket debut. "It's reassuring because it shows that what we're doing is the right thing,'' he said.
But he was looking forward to running the business without the extra distraction of a sharemarket listing process, which had soaked up substantial time.
Burson has outlined growth plans over the next five years where it aims to expand to 175 stores, with Western Australia a large focus because Burson does not have a presence in Perth and wants to complete a national footprint.
"It's certainly a major focus, but it's not the only one. We'll only do Western Australia if the economics are right,'' Mr Abotomey said.
Burson is in negotiations with the listed Automotive Holdings Group over a potential deal to buy 27 retail stores that trade under the banner of Covs, to fill in the WA gap.
Quadrant sold down from 86.2 per cent in the float to 19.9 per cent. In early trades on Thursday, Burson hit a high of $2.06 and with 163.6 million shares on issue that gave it a market capitalisation of $337 million.
