Standard Life has announced that eligible members may apply for additional, discounted, shares via a 'preferential offer' with a price range of 199.5p to 256.5p. This represents a 5% discount to the offer price, which is expected to be confirmed by 9 July.
| "This represents a 5% discount to the offer price." |
The preferential offer is subject to a minimum application of £1,000 and a maximum allocation of £50,000 per person of ordinary shares at the preferential offer price. If demand is high then the offer could be scaled back using an allocation policy that may favour smaller applications.
Standard Life has also confirmed that members will be able to use an 'Initial Share Sale Facility' to sell their demutualisation shares on admission at the offer price, subject to a £10 administration charge. However, members who opt for this route will not be eligible to apply for preferential offer shares.
Our view is that purchasing shares at a 5% discount with no minimum holding period could be an attractive opportunity. Assuming the floatation is fully subscribed then there's a fair chance investors will be able to sell the discounted shares at a premium immediately after the float. Nonetheless, it is important not to neglect the risks of holding shares in one specific company.