Betfair’s London IPO Notes Extreme Success

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October 30th, 2010

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Great demand supplied with extra allocation of shares

As it was already foreseen, Betfair's London IPO this month proved to be a great success, as the prelisting orders are exceeding expectations by far, and the share price has been blooming this week, achieving its top value of over GBP15. In fact, the listing turned out to be so profitable, that the market saw an extra allocation of shares in the value of GBP 22.8 million.

Such development of events made the company founders Andrew Black (an ex-gambling pro) and Ed Wray (a former City trader) even richer.

Based on City AM’s reports for the end of the week, Stabilizing Manager Morgan Stanley added the over-allocation clause when the shares in the betting exchange boosted from GBP13 and exceeded GBP15.

By selling another 10 percent of their shares in the company, Black and Wray cashed in another GBP1.9 million and GBP1.7 million, respectively. Previously, they earned GBP 14 million and GBP 17 million.

Concerning other stakeholders, such as Charlton Acquisition and Balderton Capital, they also put another share of their holding of the company for sale, boosting the total share of the company on the market to 46 percent – last week’s 15.2 percent, the over-allocation mechanism’s 1.6 percent, and almost 30 percent that belong to staff and small shareholders.

Last week’s amount of shares amounted to GBP233.7 million. The over-allocation sum was at GBP 22.8 million before underwriting commissions and expenses.

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