Myer Shares Fall in Trading Debut in Australia

Nov. 2 (Bloomberg) -- Myer Holdings Ltd., Australia’s biggest department store chain, fell in Sydney as its shares began trading for the first time on the nation’s stock market.

Myer stock began trading at A$3.88 in Sydney, compared with the A$4.10 paid by investors last week in the nation’s largest initial public offering this year.

Buyout firms TPG Inc. and Blum Capital, which teamed with members of the founding Myer family to buy the retailer in 2006, sold all their shares in the IPO, taking advantage of a 44 percent rise in the benchmark stock index since March. More than A$2.1 billion ($1.9 billion) was raised, compared with the A$1.4 billion paid for the chain less than four years ago.

Myer, which has 65 stores, plans to open 15 more in the next five years, it said in the prospectus for the share sale.

Myer sold 529 million shares, with the proceeds of more than A$2.1 billion making it Australia’s largest since drilling services provider Boart Longyear Ltd. raised A$2.4 billion in April 2007.

The IPO priced Myer stock at 15.1 times forecast earnings. David Jones Ltd., Australia’s second-largest department store, is trading at 15.8 times earnings.

While Blum and TPG sold all their shares, management retain about 7.7 percent of the company’s issued capital and the Myer Family Co. Pty. has about 1.5 percent.

The Myer chain was founded in 1900, when Sidney and Elcon Myer, immigrants from Russia, opened their first shop in the town of Bendigo in Victoria state. In 1985 it was purchased by G.J. Coles & Coy, creating Coles Myer Ltd., Australia’s biggest retailer and largest publicly traded corporation at the time.