Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


SNAP Fonterra units rocket up 22 percent in NZX debut

SNAP Fonterra units rocket up 22 percent in NZX debut

Nov. 30 (BusinessDesk) - Units in the Fonterra Shareholders' Fund jumped 21 percent on their debut as investors clamoured to get more exposure to the dairy cooperative's earnings after a $525 million initial public offer.

The fund, which grants holders access to Fonterra's dividends but not voting rights, opened at $6.66, after the issue price was set at $5.50 after a bookbuild, the top end of the indicative range. It recently traded at $6.70, with some 3.9 million units changing hands in the first few minutes of trading.

The units climbed on heavy volumes even as this story was being published.

Some 58 percent of the units were allocated to New Zealand retail and institutional investors and the class of investors known as Friends of Fonterra, which includes Australia’s Bonlac. The rest were sold to foreign institutions.

The change will substantially reduce the share redemption risk on Fonterra’s own books, which has billowed to more than $700 million in recent years, by giving farmers a venue to trade the shares among themselves.

No farmer shareholders used the new facilities to trade Fonterra stock among themselves.

While the fund attracted massive demand, the pricing was deemed too rich for research firm, Morningstar, which last week gave a 'do not subscribe' recommendation. Morningstar said investors would be better served waiting for the units to list and consider buying in if the price fell to $4.95.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Final Frontier: Rocket Lab And NASA Sign Commercial Space Launch Agreement

Rocket Lab has signed a Commercial Space Launch Act Agreement with the National Aeronautics and Space Administration (NASA). The agreement enables Rocket Lab to use NASA resources - including personnel, facilities and equipment - for launch and reentry efforts. More>>

ALSO:

Scoop Business: Wheeler Downplays Scope For ‘Large’ Rates Fall

Reserve Bank governor Graeme Wheeler says some market commentators are predicting further declines in interest rates that would only make sense for an economy in recession, although some easing is likely to be needed to maintain New Zealand’s economic growth. More>>

ALSO:

Ruataniwha Dam: Consent Conditions Could Mean Reduced Intensity

Legal advice sought by the Hawke’s Bay Regional Council on the Ruataniwha Dam consent conditions has confirmed that farmers who sign up to take water from the dam could be required to reduce the intensity of their farming operation to meet the catchment’s strict nitrogen limit. More>>

Health And Safety: Bill Now Sees Rules Relaxed For Small Businesses

Health and safety law reform sparked by the Pike River coalmine disaster has been reported back from the industrial relations select committee with weakened requirements on small businesses to appoint health and safety representatives and committees. More>>

ALSO:

Bearing Fruit: Annual Fruit Exports Hit $2 Billion For First Time

The value of fruit exported rose 20 percent (up $330 million) for the June 2015 year when compared with the year ended June 2014. Both higher prices and a greater quantity of exports (up 9.0 percent) contributed to the overall rise. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news