Saga starts life in big league with a whimper as City cools on listings

 

Flotation fatigue deepened across the City yesterday as Saga began life as a listed company with a whimper. 

The over-50s cruise and financial services group had priced its shares at 185p. They rose to 189p before falling back to 185p at the close of its first day of conditional trading. The company’s advisers, led by Citigroup, had hoped to price the shares as high as 245p.

Saga is owned by the private equity groups Permira, Charterhouse and CVC, which had planned to sell shares to raise capital. However, a lack of demand among the investor community meant that its owners will not sell down their holding but 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 the other half by retail investors. The £550m raised from the listing, before fees, will be used to pay down debt.

Lance Batchelor, the chief executive of Saga, said: “As a public company, owned in part by our customers, Saga will be even better positioned to continue helping the over-50s live life to the full.”

However, Saga’s sluggish start is the latest sign that the recent appetite for  flotations is abating, after the fashion retailer Fat Face pulled its listing on Thursday and other newly floated names, including Pets At Home and Just Eat, have seen their shares fall.

Chris Beauchamp, market analyst at the spread-betting firm IG, said: “The decision of [Saga] to float as a travel and leisure rather than insurance firm has dented enthusiasm among City investors.

Retail investors remain keen, however, and the likelihood is that we will see the shares move gradually higher as big institutions get over their initial disillusionment and start buying in earnest.”

One company that now looks unlikely to join the London Stock Exchange is the foreign currency group Travelex, which was yesterday bought by Bavaguthu Shetty, the owner of the money-transfer service UAE Exchange, and the Middle Eastern Centurion Investments in a deal thought to be worth £800m to £1bn.

Mr Shetty is also the founder and chief executive of the London-listed NMC Health and is worth about $880m (£525m), according to Forbes magazine.

Travelex’s founder, Lloyd Dorfman, who has known the Indian entrepreneur since the 1990s, will retain a small shareholding in the group and stay on as its president if the deal is completed. Before the sale, his holding in Travelex was thought to be worth about £300m ,with the majority of the group owned by the private equity firm Apax Partners. 

Mr Dorfman said: “This is a significant milestone for Travelex and for me personally.

Since I founded Travelex 38 years ago, we have grown from a single shop into an international brand recognised and respected around the globe. I am immensely proud of what we have achieved and am excited about the future.”

Stelios steps up EasyHotel plans listing

Sir Stelios Haji-Ioannu’s discount hotel chain easyHotel is planning to float, in a move that could value it at £100m.

The “super budget” hotel chain, set up by the founder of the low-cost airline easyJet, yesterday said that  it would seek to raise £60m on the London Stock Exchange’s junior Aim market.

EasyHotel said it is looking to raise capital to fund expansion across big European cities. It currently has 18 Hotels in Europe, plus two more in Dubai and Johannesburg, with beds in central London offered for less than £35 a night.

Start your day with The Independent, sign up for daily news emails
ebooks
ebooksAn introduction to the ground rules of British democracy
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
SPONSORED FEATURES
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

SThree: Experienced Recruitment Consultant

£20000 - £40000 per annum + OTE + Incentives + Benefits: SThree: Established f...

SThree: Trainee Recruitment Consultant

£20000 - £25000 per annum + OTE 40/45k + INCENTIVES + BENEFITS: SThree: The su...

Recruitment Genius: Collections Agent

£14000 - £16000 per annum: Recruitment Genius: This company was established in...

SThree: Trainee Recruitment Consultant

£20000 - £25000 per annum + OTE 40k: SThree: SThree are a global FTSE 250 busi...

Day In a Page

Refugee crisis: David Cameron lowered the flag for the dead king of Saudi Arabia - will he do the same honour for little Aylan Kurdi?

Cameron lowered the flag for the dead king of Saudi Arabia...

But will he do the same honour for little Aylan Kurdi, asks Robert Fisk
Our leaders lack courage in this refugee crisis. We are shamed by our European neighbours

Our leaders lack courage in this refugee crisis. We are shamed by our European neighbours

Humanity must be at the heart of politics, says Jeremy Corbyn
Joe Biden's 'tease tour': Could the US Vice-President be testing the water for a presidential run?

Joe Biden's 'tease tour'

Could the US Vice-President be testing the water for a presidential run?
Britain's 24-hour culture: With the 'leisured society' a distant dream we're working longer and less regular hours than ever

Britain's 24-hour culture

With the 'leisured society' a distant dream we're working longer and less regular hours than ever
Diplomacy board game: Treachery is the way to win - which makes it just like the real thing

The addictive nature of Diplomacy

Bullying, betrayal, aggression – it may be just a board game, but the family that plays Diplomacy may never look at each other in the same way again
8 best children's clocks

Tick-tock: 8 best children's clocks

Whether you’re teaching them to tell the time or putting the finishing touches to a nursery, there’s a ticker for that
Isis profits from destruction of antiquities by selling relics to dealers - and then blowing up the buildings they come from to conceal the evidence of looting

How Isis profits from destruction of antiquities

Robert Fisk on the terrorist group's manipulation of the market to increase the price of artefacts
Labour leadership: Andy Burnham urges Jeremy Corbyn voters to think again in last-minute plea

'If we lose touch we’ll end up with two decades of the Tories'

In an exclusive interview, Andy Burnham urges Jeremy Corbyn voters to think again in last-minute plea
Tunisia fears its Arab Spring could be reversed as the new regime becomes as intolerant of dissent as its predecessor

The Arab Spring reversed

Tunisian protesters fear that a new law will whitewash corrupt businessmen and officials, but they are finding that the new regime is becoming as intolerant of dissent as its predecessor
King Arthur: Legendary figure was real and lived most of his life in Strathclyde, academic claims

Academic claims King Arthur was real - and reveals where he lived

Dr Andrew Breeze says the legendary figure did exist – but was a general, not a king
Who is Oliver Bonas and how has he captured middle-class hearts?

Who is Oliver Bonas?

It's the first high-street store to pay its staff the living wage, and it saw out the recession in style
Earth has 'lost more than half its trees' since humans first started cutting them down

Axe-wielding Man fells half the world’s trees – leaving us just 422 each

However, the number of trees may be eight times higher than previously thought
60 years of Scalextric: Model cars are now stuffed with as much tech as real ones

60 years of Scalextric

Model cars are now stuffed with as much tech as real ones
Theme parks continue to draw in thrill-seekers despite the risks - so why are we so addicted?

Why are we addicted to theme parks?

Now that Banksy has unveiled his own dystopian version, Christopher Beanland considers the ups and downs of our endless quest for amusement
Tourism in Iran: The country will soon be opening up again after years of isolation

Iran is opening up again to tourists

After years of isolation, Iran is reopening its embassies abroad. Soon, there'll be the chance for the adventurous to holiday there