Steadfast hits the ground running
Australia's newest listed company, Steadfast, made its debut with a flurry of interest as shares surged nearly 25 per cent on Friday.
The insurance broker network opened 17.4 per cent higher than its initial public offer price of $1.15 when it listed on the Australian Securities Exchange at midday.
The shares kept rising throughout the session to close 23.5 per cent higher at $1.42.
Steadfast chief executive Robert Kelly said the IPO was oversubscribed but the company was still impressed by the stock's performance. "We are blown away by the fluidity of the stock and the degree of respect that the institutions are paying it," Mr Kelly said.
He confirmed that Perpetual, BT, Colonial First State, AMP Capital and Caledonia Investments all invested in the IPO.
The company raised approximately $334 million through the issue of 290 million shares. About 40 per cent of the stock offered went to shareholders that had sold their businesses into Steadfast Network Brokers and converted their equity into shares in the publicly listed company.
Steadfast's closest comparable business is Austbrokers, whose stock price has been running near record highs. "The biggest difference is it [Steadfast] has only just had all of these businesses rolled up as a product of this IPO," director of Select Equities Danny Goldberg said. "Perhaps there's a risk in the next 12 months that some of the internal acquisitions that Steadfast has done might not pan out as successfully, [and] the individual business operators might take their foot off the accelerator," he said.
"Barring that, using Austbrokers as a comparative business model, you'd expect it to go quite well."
The ASX says the Steadfast listing is the ninth this financial year and the 49th this calendar year. It is the largest listing since Virtus Health in June which raised $339 million.