|Wednesday, May 09, 2012||Publisher: Íslandsbanki Research - email@example.com - Resp.Editor: Ingólfur Bender|
Vodafone aims at autumn listing
Vodafone will be listed on the stock exchange in the autumn, in September or October, following an offering directed at institutional and general investors. This was confirmed by the Vodafone Chairman of the Board in an interview with today's Markaðurinn [The Market], the business section of Fréttablaðið. As the country's second-largest telecom firm, Vodafone is majority-owned by the Enterprise Investment Fund, which holds 79.5% of company stock. If the listing proceeds as planned, Vodafone will be the first company that the Fund lists on the exchange. A number of firms have announced plans for market listing in the recent term, although only one has been finalised since the crash: the Hagar listing in December 2011. We expect that new corporate listings on the main market will begin to rise in the second half of the year and that 2013 will be a big year for new listings.
Wave of new listings in the offing
Firms drive a variety of benefits from stock exchange listing. The securities market increases their access to new share capital, and listed companies generally have easier access to credit. Under a capital controls regime, the share capital that companies can access is in Icelandic krónur only; therefore, firms that need increased equity and operate primarily in the domestic market are likely candidates for listing. In addition, stock market listing can provide an exit route for owners wishing to reduce or close out their positions in the company. Such owners include banks or other providers of capital that have converted debt into share capital and do not intend to hold their stake in the company for the long term. This category covers a large number of companies undergoing financial restructuring. Another example is investment funds that generally have a defined holding period of 3-5 years. Listing is an effective way for them to sell their holdings at the end of that period. The listing of Vodafone, which is owned by the Enterprise Investment Fund, is an example of this. Other companies that are partly or wholly owned by the Fund are likely to be listed in the near future, among them Advania, which has announced plans for listing in 2013, and N1, which has announced its plans to go public within two years. Promens and Icelandic Group will probably join them before too long.
Other firms that have been mentioned in this context are TM and
Eimskip, both of which have announced plans for listing; the real estate
firms Reginn and Reitir, insurance firms VíS and Sjóvá; and the oil
company Skeljungur. Some of them will probably manage to complete
preparation for listing later this year or in 2013, adding to domestic
stock market offerings. The supply of shares available will depend on how
large a stake is sold, as the Nasdaq OMXI exchange requires that 25% of a
listed company's shares be owned by general investors.
A total of 501 residential leases were registered in April, 191 fewer than in March. The decline measures 28%. The year-on-year decline is almost 20%, as registered leases totalled 611 in April a year ago. This accords with developments in the past few months, with the rental market contracting markedly after the post-crisis surge. In the greater Reykjavík area, a total of 350 leases were registered in April, down 15% from the April 2011 total of 413. In the first four months of the year, a total of 2,723 leases were registered nationwide, as compared with 2,887 for the same period in 2011. This corresponds to a YoY decline of 6%. Concurrent with the contraction in rentals, the market for house purchases is growing. A total of 1,519 purchase agreements for homes in the greater Reykjavík area were registered in the first four months of 2012, an increase of about one-fifth YoY.
Treasury bill auction this Friday
According to a press release issued by Government Debt Management (GDM) yesterday, GDM will hold its monthly auction of Treasury bills at 11:00 on Friday. In keeping with the GDM issuance calendar, two bills will be offered: a three-month bill maturing on 15 August 2011, and a six-month bill maturing on 15 November 2011. The former series, originally issued in February, is ISK 1.9 bn in size. As usual, the lowest accepted price - and therefore the highest yield - determines the selling price for each series.
Weak participation in April Treasury bill auction
Treasury borrowing terms deteriorate
Low Treasury bill balance
Íslandsbanki's Research News & Reports are compiled by the staff of Íslandsbanki's Research Division. The information contained in these summaries is based on domestic and international sources and news networks, which are considered to be reliable, in addition to official information and the division's own estimates and opinions in each case. Íslandsbanki cannot, however, be held liable for the accuracy, reliability or correctness of this information. Íslandsbanki's Research News & Reports are only published for informational purposes and should therefore neither be looked upon as recommendations/advice to partake in or not partake in specific investments nor as an invitation to buy, sell or register with any specific financial instruments. Íslandsbanki and its staff cannot be held liable for any trading that may be carried out on the basis of the information published in Íslandsbanki's Research News & Reports. Any parties that intend to engage in trading are advised to seek expert advice and to fully acquaint themselves with the various investment options available. Investors will always be exposed to various types of financial risk, including, among other things, exchange rate volatility. One should bear in mind that past results are no guarantee of future results. Íslandsbanki's Research News & Reports offer brief summaries that should not be looked upon as exhaustive coverage of all the available information on the topics it focuses on in each case.
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