Mexican fast-food chain Guzman y Gomez made a significant debut on the Australian Stock Exchange (ASX) with its shares soaring up to 39.1% on Thursday, June 20, 2024. The company, which operates more than 200 restaurants in Australia, Singapore, Japan, and the United States and was valued at AU$2.23 billion based on its initial public offering (IPO) price of AU$22 per share, saw shares rise to as high as AU$30.28.
Guzman y Gomez's IPO is Australia's largest since chemical distributor Redox's offering in July 2023 and the fourth offering above $100 million in the past two years. The company raised AU$335.1 million through its IPO by upsizing it to 15.3 million shares from an initial offer size of 11.1 million shares.
The strong demand for Guzman y Gomez's shares was driven by the company's impressive growth and potential for further expansion, as well as its commitment from funds advised by Capital Research Global Investors.
Veteran investment banker Aidan Allen, co-CEO of Jarden, raised concerns about the rise and rise of private capital putting public markets into a long-term decline. However, the emotional reaction to Guzman y Gomez's IPO highlights the ongoing appeal of public markets for companies seeking to raise capital and investors looking for opportunities.
Meanwhile, Woolworths workers voted on a new enterprise agreement, with 62% approving a four-year deal that includes a pay rise of 3.75%. The SDA, the union representing the workers, criticized the lacklustre pay deals and called for better wages and conditions for retail and fast food workers.
