Firmus Fiasco Wipes Out $700 Million of Early Backer Maas’ Value

(Bloomberg) -- Maas Group Holdings Ltd. has lost more than A$1 billion ($699 million) in market value as Firmus Grid Ltd.'s initial public offering unraveled, with the shares extending their decline to a fifth day after Jefferies Financial Group Inc. downgraded its rating.

Shares of the Australian construction company dropped as much as 14% Monday, taking their five-day decline to 42%. Analysts at Jefferies cut their recommendation on the stock to hold from buy and lowered earnings forecasts, citing heightened uncertainty from the failed Firmus IPO.

Maas Group, which is both an investor and contractor for Firmus, has become a proxy for the data center operator in the last week as its efforts to raise as much as $5.5 billion collapsed. The company builds modular power cubes for Firmus through its JLE unit and reaffirmed its expectations to complete work orders by the end of 2027. It held a 3.2% interest in Firmus as of August.

"In our view, risks have amplified," wrote Jefferies analysts led by John Campbell in a note. The IPO failure is a "highly impactful" event for Maas across both its earnings and equity investment in Firmus, increasing concerns of a slower rollout, they added.

Jefferies also lowered its price target on the stock to A$4.85 apiece from A$7 and reduced its earnings and revenue estimates for the fiscal years through 2029. The broker also slashed the assumed value of Maas Group's Firmus stake to A$300 million from A$410 million.

Firmus is exploring options to raise as much as $3 billion in a private funding round after pulling its IPO plans, people familiar with the matter have said. It abandoned its Australian listing application on Friday as demand from offshore investors dried up for what would have been one of Australia's largest ever debuts.