Trading in C&C begins on the Irish stock market today with the shares making their debut at €2.26, the bottom of the indicative price range.
The drink and snacks group successfully placed its shares with institutional investors yesterday, paving the way for completion of its flotation despite the turbulence seen on world stock markets earlier this week.
Market sources said shares in the company had been placed with "a good list" of institutions by yesterday's deadline of 5 p.m. for receipt of bids, allowing conditional trading in the stock to begin at 9 a.m. today.
However, it is understood that the financial advisers to the flotation may have been struggling at one point yesterday to find bidders for all the shares on offer and were considering lowering the €2.26-€2.74 price range.
"It was touch and go at one stage. They were sussing out interest at a price of €2.10-€2.15 but they seem to have landed one or two of the big international houses later in the day," one fund manager said.
At a price of €2.26, C&C will have a market capitalisation of €723 million, well below the €1.1 billion valuation the company had aimed for in its previous attempt at flotation in the summer of 2002.
The company's 92 per cent shareholder, BC Partners, will be the main beneficiary of the flotation but senior management are also set to benefit from the sale of 30 per cent of their shareholding. The group's 2,000 employees will also share around €22 million through the company's save-as-you-earn scheme.
While C&C's well-known brands, strong cashflow and proposed dividend yield of 5 per cent are considered attractive, fund managers have been driving a hard bargain on price.
"The markets they are in are not growth markets. So it has to be a value stock, which means it's very price sensitive," one analyst said.
C&C, which was formerly known as Cantrell & Cochrane, was established in 1968 when Allied Breweries and Guinness Ireland merged their Irish soft drink and cider interests. Its brands include Bulmers cider, Tayto crisps and Ballygowan mineral water.
