Just barely afloat: the new approach to stock market listings

Tomorrow's Business

A genuine question for flaks – we’ll print the best replies, anonymously of course: have the rules changed on flotations? From here, they certainly seem to have.

In the old days the clear best practice was to make sure some upside was left on the table for new investors on the day of the float.

Not too much, lest anyone said the company had been undervalued by its advisers, but enough that everyone felt good.

Lately, this seems to have gone completely out the window. The strategy from banks and PRs seems to have been to get floats away at the highest price possible and then when the inevitable occurs, to laugh it off.

So what if the stock is tanking, the CEO is embarrassed and everything we said last week now looks questionable. We got the money, didn’t we?

Now, you can say that market conditions decide the float price all you like. But those market sentiments are at least partly set by the flaks and bankers on the deal.

It definitely feels like you are willing to sacrifice long term credibility for a few extra quid on day one.

Tell me I’m wrong….



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