IPO market hit as MySale slumps and Wizz Air pulls float
Monday 16 June 2014
London’s float rush suffered two further blows today as shares in online retailer MySale, backed by Topshop boss Sir Philip Green, began trading at a 20 per cent discount and low-cost airline Wizz Air pulled a planned 1 billion (£798 million) listing.
MySale, an Australian fashion flash sale site which is 25 per cent owned by Green’s wife Tina, had placed shares at 226p last week to value it at £340 million. When trading began on the junior AIM stock market today, the shares slumped 21 per cent to 179p, cutting its value to £270 million.
But sponsors to the issue, McQuarrie Capital and Zeus Capital, later said the initial share price had been incorrectly quoted in pounds rather than pence, giving the impression the shares had crashed immediately trading began. They will be repriced in pence from tomorrow.
Wizz Air, which had hoped to raise up to 200 million in new money through a sale of shares on the London Stock Exchange, blamed turmoil in the airline sector for the decision to pull its float. This followed profit warnings from Lufthansa and Aer Lingus last week and rising tensions in the Middle East.
It said the decision was made despite “positive response to our business story and the company’s growth opportunities and prospects within the institutional investment community”. Wizz Air revealed its planned flotation last month on the same day as fashion group Fat Face pulled its flotation. Wizz Air was being brought to market by investment banks Barclays, Citigroup and JPMorgan.
The spate of bad news comes as Lloyds Banking Group finalises pricing of its offer of shares in TSB, the newly spun-off bank.
Talk over the weekend was that Lloyds could tweak the price of the shares, which are available to retail investors, up slightly to value TSB around £1.2 billion. Final pricing and first dealings are due on Friday.
Stations and airports catering giant SSP, run by former WH Smith boss Kate Swann, is still expected to announce its plans to float this week. That share offer could raise up to £500 million and value the Upper Crust-to-Caffè Ritazza company at some £2 billion.
Also today, Portuguese engineer Mota-Engil said it is floating its African business in London and biopharma group Abzena said it will join AIM.
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