Colville pulls offer

Wednesday 9th June 2004

Colville Equities has decided to cancel its Initial Public Offering (IPO) because of the depressed state of the new issues market.

"All monies subscribed through the public pool will be returned to investors as soon as possible," director Brian Gaynor says in a statement. "Brokers who have taken shares on a firm basis will not be required to meet their obligations."

Gaynor says that brokers have, in the past few days, indicated that they were having trouble filling their firm allocations.

"According to brokers, investors who had initially said they would invest in Colville have withdrawn their support because of the poor performance of recent IPOs. This has also impacted on applications to the public pool."

"These unfulfilled firm allocations would have created an overhang on the market when Colville listed and depressed its share price.

"The directors' decision to cancel the issue was influenced by the concern that investors would experience a loss in value when the company listed," he said.

Colville's directors believe the company's issue structure, which offered investors an actively managed, low-cost vehicle, was well received by brokers and investors alike. Initial indications of support had been strong but deteriorated in line with market sentiment.

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