ADVISERS to the flotation of housebuilder Crest Nicholson, the most high profile new issue in the London market so far this year, last night narrowed the price range to a healthy 210p-220p, roughly at the midpoint of the pricing range. The original range was between 195p-230p.
The group, which plans to raise between 24m-29m of new shares while allowing existing shareholders to offload 90m shares, has been doing extensive marketing over the past few weeks in London, New York and also in Frankfurt.
At the current price range the company will be valued at around £550m.
The entire process is being watched closely by many in the City who are keen for a successful IPO in the hope it might stimulate activity in a quiet market.
Last year there was a dearth of IPOs in London, with the forced sale of shares by RBS in the insurance company Direct Line being the only major listing of a UK-based company.
The books close on the offer today, with pricing expected tomorrow.
Stockbroker Peel Hunt is advising its clients subscribe to the offer, saying the company is likely to come to market at a discount to the sector, despite “offering a differentiated business model, attractive operating profile and genuine expansive growth. It offers the longest landbank in the sector.”
There will be relief amongst the institutions that the company has not tried to price at the top of the range, given that many in the past have complained of too many issuers forgetting to price in a new issuers’ discount. Some institutions have effectively boycotted IPOs.