Myer was crunched yesterday when the sell down in the market met the desire for some shareholders to quit the stock and try and make a small turn.
The shares ended down 8.5% from the $4.10 issue price, or 35 cents at $3.75, amid heavy selling.
That might change today with a better night in offshore markets.
The shares listed under the issue price of $4.10, opening at $3.88 on the ASX, falling to a low of $3.70, with over 130 million sold on the day.
That was equal to more than 22% of the shares issued in the float, a high proportion.
Trading started at Midday, but the shares were still got caught by the selling yesterday.
It was another reminder that timing is everything.
Last week the final pricing was caught up by the sharp fall on Thursday in local markets, resulting in a less than expected issue price of $4.10.
Two weeks ago, when the global rally looked firm, the private equity owners, led by the US group, TPG, might have got a higher price and a better opening.
As it is they are still taking out over a billion bucks.
The $4.10 a share price was at lower end of the indicative price range of $3.90 to $4.90.
Some analysts took that to mean that shareholders taking up the offer would make a better return, and those selling yesterday are mostly professional investors who have borrowed the money to buy the shares, will settle this week and will probably make a nice turn with very little actual cash outlaid.
The selling pressure will slow now that so many shares were tipped into the market on the first day.
(It must be pointed out that the buyers of the shares sold wouldn’t have done so if they didn’t think Myer was a reasonable investment, just a question of price.)
Myer said it will have about 581 million shares on issue, a market capitalisation of about $2.4 billion and an enterprise value of $2.8 billion.
That will only be a little less than David Jones $2.6 billion, and yet DJs is a more profitable business.
Smaller retailer, Kathmandu is next up to be floated by its private equity owners.
Will the sell down and the less than stellar start for Myer cool investor demand for its shares?
David Jones shares fell in the 2% sell off, falling 11 cents, or 2.2%, to $5.25.
Myer released details of its 20 largest shareholders.
A range of local and overseas institutional investors including HSBC, BNP Paribas, Deutsche and Merrill Lynch Equities appear on the list.
Former Myer chairman Bill Wavish is on the top 20 with just over 6 million shares or 1.05% of the issued equity.
