UPDATE: Martin Aircraft plunges back to earth, volatile trading ahead
UPDATE: Volatile trading for Martin Aircraft as share price opened at 48 cents on its second day of trading on Wednesday, before zooming up to 91 cents, then yo-yoing around before closing at 88 cents.
EARLIER: The Martin Jetpack maker plunged back to earth toward the end of its first day on the ASX, after opening at a premium to its offer price.
Christchurch-based Martin Aircraft [ASX:MJP] started trading on the Australian stock exchange yesterday, opening at 60Ac, compared to the 40Ac offer price, which valued the company at $A103 million.
However, the stock quickly fell down to 40Ac within the first hour of trading, and closed at 44Ac, a 26.6% decrease on the opening price.
The share market listing followed an initial public offer that raised $A27 million to fund plans which the company says will make it the world's first commercial jetpack manufacturer by 2016.
A Chinese entrepreneurial investor, Hong Kong exchange-listed KuangChi Science, bought most of the shares offered in the IPO – 52.5 million – for $A21 million.
Existing investors cut their stakes in the company ahead of the IPO. Mr Martin sold $1.5 million of the stock taking his stake to 15.9%, while Jenny Morel's venture capital firm No. 8 Ventures sold $1.9 million worth of shares to hold 19.2% post-IPO. Ms Morel also halved her own personal stake selling 268,519 shares for $107,407.
Martin Aircraft is developing the Martin Jetpack for recreational, surveillance, and emergency response use, and an unmanned aerial vehicle version the Martin Skyhook, to use in conflict and search and rescue operations.