Hargreaves Lansdown flotation

Midnight_Cowboy_2

iantheman wrote: »

I guess from all the information one question is going to be, are those who are invited by HL to participate in the initial offer going to be in a priviliged position with their £5k worth of shares to see a fairly short-term gain? Otherwise it becomes an investment (as it should be I suppose) in the long-term profitability of the compay to produce a share value rise and/or reasonable dividends and also the possibility of a take-over bid sometime after Messrs H&L sell off the rest of their shares.

Well, a short-term gain is possible, but that would be pure speculation; and the higher the price is, the less chance of that gain. I see it more as a growth share than a provider of big dividends. Takeover could happen in a few years time. IMHO, I think the company would make a good long-term hold - for anybody that sees value in the offer price, of course, although you could argue that a long-term holder needn't worry about 5% here or there at the time of purchase.

markj1

Thanks DRS1

Could someone please paste a link to apply for the shares?

Many thanks

ajmace

Midnight Cowboy seems to be doubting that Hargreaves-Lansdown is a major provider of wrapped ISAs and SIPPS. Who else among those that refund renewal commission is bigger? Not Cofunds, not Elson Associates, .....

They do have to make the shares get off to a decent premium - all IPOs do and expecially one like H-L whose business is promoting financial gain.

If you have an invitation as a special client of H-L then it would be foolish not to take up the offer.

mutley74

would be interesting to know what criteria they have used to open the offer to HL clients. Is it for all HL clients? or is it based on client duration or client funds invested with them..?

Rhino666

I have opened a new vantage share account with HL and have the funds in place to invest.................

...........but my gut feeling is to give this one a miss !!

The timing is too contrived and the incentive is, well, non existent.

Apart from gut feeling, the logic of such an investment at the price level indicated is flawed. There is no doubt that HL are a good company with a good track record and future but I would be paying a premium for these shares at a time when arguably the stock market, which dictates HL's success, is at a precariously high level.

I wish all investors the best of luck and hope that my gut feeling is completely wrong.

Browntrout_2

Hello I have just registered on this site initially to discuss the HL Floatation.

I started investing with HL last year for the SIPP wrapper and fund discounts. Since then I've moved my ISA from fastrade and got my wife to open a £4K ISA last month.

My wife has been invited to take part in the floatation as have I.

So a mini stocks ISA is 'privileged' unless they have linked our accounts!

I have been an active investor for 20 years but find often find myself caught in the whipsaw of buying and selling at the wrong times, essentially any single company investment is high risk, so I moved SIPP and ISA investment to HL to take advantage of Mark Dampiers ideas on fund investments. I'll probably end up buying and selling funds at the wrong time but hey hoy at least there's no stamp duty and sometimes no cost!

So deluged by email from HL we loaded up Vantage with £5K each.

However I think 140 to 160 is steep and like Rhino666 thinking gut feeling give it a miss.....

140p times 474M shares gives market cap of £664M
160p times 474M shares gives market cap of £758M

That's £711M + or - £47M

So if private clients were sure of 140 to 150 then go for it, but where is the incentive if they maximise value and set it at the high end?

Sure All Share and FTSE250 trackers will be forced buyers, but these are the Institutions.

The Offer comprises an offer to certain clients and employees of the Group in the UK and to institutional investors in the United Kingdom and elsewhere outside the US. The Selling Shareholders will sell 118,579,725 Ordinary Shares pursuant to the Offer representing in aggregate 25 per cent. of the issued share capital of the Company on Admission.

The prospectus says over 350,000 active clients.
For purposes of discussion let's say a 150p offer price.
£5K could get you 3,333 shares.

If say 100,000 of us applied for £5K that's way over subscribed at 333M shares. 118M shares = 35,000 shareholders with 3,333 shares each.

However Institutions need to supplied to ensure an orderly market blah, blah.

So they get at least 50% which allows 17,700 'priviledged' clients in for 3333 shares each.

As a total guess I reckon £5K might get you 1000 shares at 155p or something, no incentives apart from no stamp duty and dealing charges.

Hardly going to change your life!
Better with Skandia Global Best ideas or PSigma Income Fund.

markj1

I have just over £6000 cash in a HL SIPP and I have not been invited to apply for shares. Is there anyone on here who did register but does not want to take up the offer? Is it possible for me to apply instead?

Many thanks

Mark

Midnight_Cowboy_2

ajmace wrote: »

Midnight Cowboy seems to be doubting that Hargreaves-Lansdown is a major provider of wrapped ISAs and SIPPS. Who else among those that refund renewal commission is bigger? Not Cofunds, not Elson Associates, .....

They do have to make the shares get off to a decent premium - all IPOs do and expecially one like H-L whose business is promoting financial gain.

If you have an invitation as a special client of H-L then it would be foolish not to take up the offer.

I don't doubt that they are a major provider, just that they don't have a monopoly.

Re your second point, there's an interesting article about why buying at flotation isn't certain to be a bargain here:

http://www.fool.co.uk/news/investing/investing-strategy/2007/05/03/dont-buy-at-flotation.aspx?source=ioodftxt0010007

Midnight_Cowboy_2

markj1 wrote: »

I have just over £6000 cash in a HL SIPP and I have not been invited to apply for shares. Is there anyone on here who did register but does not want to take up the offer? Is it possible for me to apply instead?

Many thanks

Mark

If you sign into your HL account online, you should see the float offer on the right hand side of your 'Home' screen. If you don't see it, I would guess that means you're excluded from the offer. I haven't see any publicity as to what criteria they have used for inviting customers to purchase the shares.

ajmace

Midnight Cowboy, I'm glad that you have recognised that Hargreaves-Lansdown are a major supplier of financial saervices, especially ISAs and SIPPS.
I read the link to MoneyFool: what is he saying? Lastminute.com was fine until the dotcom crash and Jessops also fine until they started giving profit warnings in the past year. There are plenty of other IPOs that have performed well, eg Aer Lingus.

Have faith in the product - if you can get some shares via an invitation from H-L take it, it may not be as good as the Government flotations in the 1980s but it will surely be a sound investment over the medium term.

Good luck everyone. If you don't apply then I might get my full allocation!