PRIVATE equity came under fresh pressure yesterday after another new listing struggled on its debut.
Italian ratings agency Cerved, floated by CVC Capital, fell from €5.10 to €4.80 before recovering to €5 on its debut. AA, co-owned by CVC, also suffered weakness after a poor debut on Monday.
Veteran investor Jon Moulton said a listing like AA was doomed for a poor start. “There was nobody at the table with any desire other than to complete the float. All the ingredients are there for an over-priced issue,” he said at a conference yesterday.
Trade body the BVCA has defended the industry. Writing in City A.M., policy head Simon Horner said: “Those that are looking beyond first day froth are, more often than not, being rewarded.”
However, some fund managers are increasingly sceptical about the IPO market. Anne Richards, chief investment officer of FTSE 100 giant Aberdeen Asset Management, said: “There are signs of fatigue setting in among investors. We are long term investors and like to really understand a business before we invest in it. That’s quite hard to do with IPOs.”