Genworth Says Australia Unit IPO More Likely Next Year
Genworth Financial Inc. (GNW), the insurer that delayed an initial public offering of its Australia mortgage guarantor in 2012, said yesterday that the IPO will probably come in 2014 rather than this year.
There is “more likelihood maybe we push it into 2014, versus now” Chief Executive Officer Tom McInerney said at a conference sponsored by KBW LLC. “I think there will be regulatory uncertainty into 2014.”
Former CEO Michael Fraizer resigned in May 2012 after delaying the IPO the previous month following a loss at the unit. McInerney said in July that Genworth was targeting an offering in the final three months of this year or later, depending on Australia’s equity markets.
The Australian economy faces risks tied to its reliance on commodities, including exports to China, McInerney said yesterday. He also said it is unclear how new rules on bank capital will affect lenders’ use of home-loan guaranties. Mortgage insurance covers losses when homeowners default and foreclosures fail to recoup costs.
Growth in the Australian economy is expected to slow to 2.5 percent this year from 3.7 percent in 2012, according to the median of 35 estimates compiled by Bloomberg. Australia’s S&P/ASX 200 Index (AS51) has climbed 13 percent this year through yesterday, compared with the 19 percent rally of the Standard & Poor’s 500 Index in the U.S.
Genworth rose 3.9 percent to $12.73 at the close yesterday in New York, extending gains for The Richmond, Virginia-based company to 70 percent this year.
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