Vallares slips on its London trading debut
THE oil investment vehicle fronted by former BP boss Tony Hayward and financier Nat Rothschild was trading slightly lower than its bumper IPO price on its first day trading yesterday.
Vallares floated at £10 a share and was trading around the £9.90 mark for much of yesterday. The firm raised £1.35bn in its IPO last week, above its initial plan to raise £1bn.
The fund intends to engineer the reverse takeover of an unlisted oil group in an emerging market.
The shareholder base includes long-only investment funds on both sides of the Atlantic, hedge funds and sovereign wealth funds.
Better Capital chairman Jon Moulton yesterday warned of a possible commodities bubble, saying the valuations of some recent commodity sector flotations look “incredibly bubbly”.
He pointed to Vallares and Caparo Energy as examples of the frothy commodity-related IPO market.
Vallares will effectively offer a target, whose owners may end up with a majority stake of the listed company, a fast track route to a UK stockmarket listing and, thereby, the ability to raise money more cheaply than they currently can.
The vehicle has two years to strike a deal or to return the cash to investors.
Vallares echoes Vallar, a structure Rothschild created last year to focus on coal assets.
Vallar is in the process of buying control of two Indonesia-focused mining ventures from companies within the indebted Bakrie Group, in return for giving the politically-connected Bakrie family around half of Vallar.