Mums and dads make 11% on Medibank debut
Shares in Medibank Private have made a solid start to trading on the stock market, debuting at $2.22 per share.
Shares in Medibank Private have made a solid start to trading on the stock market, making their debut at $2.22 per share.
Mum and dad investors had paid $2 per share ahead of the health insurer's much-anticipated $5.7 billion stock market listing.
The stock made its strong debut amid widespread slides on the overall market today.
The federal government raised $5.7 billion from selling off Medibank, $1 billion more than the coalition had forecast.
All the money will be tipped into the government's so-called asset recycling fund, which helps pay the states and territories to sell assets and use the proceeds to build new infrastructure like roads.
Managing director George Savvides said the interest from investors had been overwhelming and Medibank now had about 440,000 shareholders.
"Up until today there have been relatively limited opportunities to invest in in private health insurance as a sector," he said.
"(Investors now have) the ability to invest in an ASX top 100 private health insurer."
Finance Minister Mathias Cormann said he was "very satisfied" with the Medibank float.
He said the privatisation was a "win-win" for Medibank policy holders and taxpayers.
"It's a win for Medibank Private policy holders because we believe Medibank Private in private hands will perform even better than under government ownership because they will have more flexibility to pursue growth opportunities into the future," he said.
"It's a win for all Australians with private health insurance and indeed it's a win for all Australians seeking affordable access to high quality health care ... and of course it's a win for taxpayers."
Medibank was the highest traded stock on the Australian market at 9:40am, with 259 million shares having changed hands.
CMC Markets sales trader Will Leys said Medibank's stock market float had been a good result.
"There has been quite a build up and excitement amongst the general public," he said in a note to clients.
"The sheer size of the listing, combined with the fact that it has been part of Australian landscape for so long, justifies the attention it's receiving."
Medibank shares closed at $2.14 per share.
