LONDON (Alliance News) - The initial public offering of the healthcare arm of Bank of Georgia Holdings PLC was on Monday priced at well below its expected price range, though shares in the company rose in early trade.
The IPO was priced at 170 pence per share, valuing the carved out business at GBP218.0 million by market capitalisation on admission to the London Stock Exchange. The expected price range had been set at between 215 pence to 315 pence, which would have valued the business at between GBP257.0 million and GBP347.0 million.
Shares in the company were trading higher early on Monday, however, up 7.1% to 182.00 pence.
The listing of Georgia Healthcare Group PLC from its parent marks Bank of Georgia Holdings' commitment to its banking business and other financial subsidiaries. The banking division is one part of a corporate structure which also includes the investment arms within which the healthcare unit resides.
The offering, which is raising about USD100 million, or GBP66.0 million, through the issue of 38.7 million shares, will allow Georgia Healthcare Group to renovate and develop its recently acquired Deka and Sunstone referral hospitals in Tbilisi, finance current expansion plans, and reduce debt.
Georgia Healthcare Group will receive about USD95.0 million from the offering, while a group of more than 20 board members of both companies will receive USD4.5 million. That group includes Bank of Georgia Chairman Irakli Gilauri and Georgia Healthcare Group Chief Executive Nikoloz Gamkrelidze.
Bank of Georgia Holdings will retain a 68% stake in the healthcare arm following admission to trading.
That stake could fall to 65% if an additional 3.9 million shares are sold under an over-allotment option.
By Samuel Agini; samagini@alliancenews.com; @samuelagini
Copyright 2015 Alliance News Limited. All Rights Reserved.