Insurer Standard Life, under pressure from falling equity markets, has slashed the range for its July listing by about 10% to 210-270 pence a share, valuing the company at up to £5.25 billion sterling. The insurer has around 95,000 Irish policyholders.
The April range of 240-290 pence a share, which valued the company at up to £5.5 billion, was set to reflect Standard Life's value at that time, had it been quoted. Since then, the FTSE 100 index of blue chip shares has dropped around 9% and the DJ Stoxx index of European insurance shares has fallen over 11%.
Today's latest range is still likely to propel Standard Life into the FTSE 100 as the fifth largest UK-listed life insurer, just above another former mutual, Friends Provident.
'We have had hundreds of contacts with investors, investment banks in the last couple of weeks and we have real confidence this IPO will be done within the range,' CEO Sandy Crombie said at a briefing today. 'Standard Life has every prospect for an excellent, independent future,' he added.
The Edinburgh-based insurer, which aims to raise £1.1 billion of net new capital, had dismissed talk that falling markets could push it to delay the planned debut. But sources familiar with the situation had said that tough conditions would likely mean a price range around 10% below the range given in April, when a demutualisation prospectus was sent to members.
The final pricing will be announced on July 9, ahead of a July 10 market debut.
Standard Life, which fought off an attempt to scrap its mutual status in 2000, shocked rivals and customers two years ago when it announced plans to go public, saying regulatory capital requirements and a declining market for with-profits products forced it to turn to the market for cash.
Money raised in the flotation will be used to expand its UK business and support capital adequacy.
