Hot demand for Genesis Energy float
"So National told us Mum and Dad investors could invest in these assets - and when they try to buy shares, they are heavily scaled back. What a disgrace!"Featured comment
The government will progressively scale down applications for large shareholdings in Genesis Energy ahead of tomorrow's listing after the final partial privatisation in the current programme attracted 68,000 investors.
The scaling policy will cap general applications at $5,000, or 3,226 shares, and the government cut the broker allocations by 20 percent to meet the demand, Finance Minister Bill English and State Owned Enterprise Minister Tony Ryall said in a statement. Investors seeking up to 1,613 shares will get the full amount and those wanting between 1,613 shares and 3,226 shares will get the first 1,613 and 28.75 percent of the rest they asked for.
Investors wanting between 3,226 shares and 26,226 shares will receive the first 2,076 then 5 percent of that they asked for beyond 3,226 shares, and those wanting more than 26,226 shares will be capped at 3,226 shares.
The initial public offer attracted more interest than Meridian Energy, which drew 62,000 shareholders, though was less than the 113,000 people who bought into MightyRiverPower, the first IPO of the programme. New Zealand retail investors will end up with 26.7 percent of the company, local institutions with 10 percent, foreign institutions with 12 percent and participating iwi with 0.3 percent. The Crown will hold the balance of 51 percent.
Genesis will list tomorrow after a sale that raised $733 million for the government, taking the total proceeds from the mixed ownership model programme to $4.7 billion. The offer price was $1.55 per share.
Four of five independent research reports valued the shares above the offer price, which is seen as providing a strong dividend yield to investors.
What do you think? At what price will Genesis Energy list? Click here to vote in our subscriber-only business pulse poll.
[i] Excluding any shares withheld for allotment of Loyalty Bonus Shares (where applicable)
[ii] Includes shares withheld for allotment of Loyalty Bonus Shares or allocated to Participating Iwi (where applicable)
[iii] Air New Zealand share offer was for 22% of shares in the company