Retail Shareholders Line Up As Afterpay Completes Institutional Placement

Given the very positive reaction from investors to the Kogan retail issue, buy now pay later group, Afterpay will be knocked down in the rush from its retail base when its offer opens shortly.

Shares in the company traded at $66 yesterday, down 2.9% from its Monday close but at the raised issue $66 price paid by investors as part of the $600 million institutional placement component. The shares had traded as high as $67.50.

The raising has an underwritten floor price of $61.75 per share, which was a 9.2% discount, but hungry investors bid it up to $66 over the course of the raise on Tuesday, trimming the discount to just 2.9%, one of the lowest seen in the current round of fundraisings.

Co-founders Anthony Eisen and Nicholas Molnar each sold 2.05 million shares as well, and reaped $135.3 million each, up from the original $125 million each.

Retail investors will soon be able to buy more shares through a $150 million share purchase plan at $66 a share.

Afterpay will very likely be knocked down in the rush to grab those shares and could be forced to lift its target by a significant amount.

Kogan yesterday revealed it had received bids for $115 million from its retail base for $15 million and had lifted the size of the retail offering to $20 million.

The NAB holds the current record for investor demand for retail issues – its original target of $500 million was boosted to $1.25 billion thanks to the overwhelming demand from its retail base.

Afterpay shares last week hit a record high of $70 each.

Glenn Dyer

About Glenn Dyer

Glenn Dyer has been a finance journalist and TV producer for more than 40 years. He has worked at Maxwell Newton Publications, Queensland Newspapers, AAP, The Australian Financial Review, The Nine Network and Crikey.

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