Question mark hangs over market for new flotations as EuroDollar joins plug-pullers

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The Independent Online
THE NEW issues market suffered another blow yesterday as EuroDollar, the second-biggest car and van rental company in the UK, halted its stock market flotation just 24 hours before publishing its prospectus.

EuroDollar's move has raised questions about the chances of other companies succeeding with flotations this year as the stock market continues to fall.

Analysts said EuroDollar would have been valued at between pounds 115m and pounds 130m. The company has made more than 50 presentations to institutions.

Ian Mosley, chief executive of EuroDollar, tried to put a brave face on the decision to halt the flotation.

The issue, he said, could be revived 'in a short period'.

'We decided it was not clever to try to push water uphill. All we are looking for is a period of stability so the professionals in the market can know what they are doing.'

The decision to stop the flotation was taken on Monday on the advice of S G Warburg and J Henry Schroder Wagg, broker and merchant bank adviser respectively to EuroDollar.

Other recent flotation casualties include British Printing, London Capital, the old Randsworth Trust property company and two cable television companies, General Cable and Telewest.

Other companies waiting to come to market include Jasmine, the bingo club operator, Cassel, the publisher, Usher Walker, the brewing and pub group, and Gardner Merchant, the market contract caterer.

But today's expected pounds 1.6bn issue from 3i, the venture capital group, is poised to proceed even though the pricing of the issue may have to be pitched at a discount of between and 12 and 13 per cent discount to the company's net asset value to ensure success.

Underwriting of the issue is said to have been completed.