Flotation fatigue in the City deepened today as Saga began life as a listed company with a whimper.
Despite the over-fifties cruise and financial services group pricing its shares at 185p, it rose a mere 0.5p to 185.5p. The listing values the company at £2.1 billion and is a blow to the advisers, led by Citigroup, who had hoped to price shares as high as 245p.
Saga is owned by private-equity groups Permira, Charterhouse and CVC, who had planned to sell shares to raise capital and to pay down debt.
However, a lack of demand among the investor community meant its owners will not sell down their holding but will issue new shares, representing 27 per cent of the business. Half of the shares on offer were bought by institutions such as pension funds and other half by retail investors. The £550 million raised from the listing, before fees, will be used to pay down debt.
Lance Batchelor, chief executive, said: “As a public company, owned in part by our customers, Saga will be even better positioned to continue helping the over-fifties live life to the full.”
The news is the latest sign the recent rush of flotations is slowing, after retailer Fat Face yesterday pulled its listing and other newly floated names, including Pets At Home and Just Eat, have seen their shares fall (see right).
However, easyHotel, part of Sir Stelios Haji-Ioannou’s easyGroup empire, today revealed plans to list. It will look to raise up to £60 million.