EasyJet flotation priced at between 300p and 320p

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The Independent Online

Shares in easyJet are expected to be priced at between 300p and 320p when trading begins this morning, valuing the low-cost airline at nearly £800m.

Shares in easyJet are expected to be priced at between 300p and 320p when trading begins this morning, valuing the low-cost airline at nearly £800m.

The offer is estimated to have been eight to nine times subscribed despite initial fears that the flotation could be blown off course by turbulent stock markets.

At the mid-point in the price range of 310p, the offer would value easyJet at £780m and raise £195m to help the airline fund its ambitious fleet expansion programme.

Stelios Haji-Ioannou and his advisers, Credit Suisse First Boston and UBS Warburg, were meeting late last night to finalise the pricing after completing the last of the institutional roadshows in Glasgow and flying down to London.

A price range of 300p to 320p would value easyJet at £756m to £806m - far above the £600m price tag analysts put on the airline when Mr Haji-Ioannou first confirmed plans to float the business this summer.

Mr Haji-Ioannou is floating 25 per cent of the airline, leaving his family with a 65 per cent stake and directors and employees around 10 per cent. The offer is open only to institutional investors, meaning that small investors will miss out on any premium that the shares may go to today. Barring a sharp correction on the stock market they are likely to rise given the level of demand for the shares.

EasyJet was given a boost last week when the rival cut-price airline Ryanair produced better than expected profit figures and even British Airways interim results came in at the top end of analysts' forecasts.

The offer will value the stake held by easyJet's chief executive, Ray Webster, at around £5.6m while another non-executive director, Amir Eilon, a long-standing friend of Mr Haji-Ioannou, will emerge with a holding worth about £4.2m.

EasyJet's 330 most senior managers and pilots will each receive an average of 25,000 share options, yielding a profit of £32,000.

The remainder of the 1,400 staff, ranging from cabin crew and call-centre staff to cleaners, will each receive an average of 750 free bonus shares worth around £2,300.

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