The over-50s lifestyle group Saga (LSE: SAGA) confirmed this morning that it has priced its shares at 185p — valuing the company at £2.1bn.
This is at the bottom of the original of 185p to 245p price range, likely to avoid a steep slide in the share price, much like Just Eat and Poundland, which listed earlier this year.
Andrew Goodsell, Saga’s chairman, commented:
“We have been very pleased with the level of demand for Saga shares from both retail and institutional investors, with the offer subscribed several times over.”
“We are delighted to have so many of our customers as shareholders and to have a high quality group of core institutions who we believe will be long-term supporters of the business.”
Some 700,000 of Saga’s 2.1m customers registered an interest in receiving shares, so it is in the company’s own interest to try to underpin a positive aftermarket performance for retail investors — otherwise embittered customers could turn away from Saga products.
50% of Saga’s offer has been allocated to retail investors, while the other half has been allocated to institutions.
Shares in Saga, which generated £159m profit last year, will begin trading on 29 May. The minimum application amount of £1,000 will see customers receive 540 shares.
