Murray Goulburn shares higher on ASX debut

http://www.theaustralian.com.au/bus...her-on-asx-debut/story-fn91v9q3-1227426772596

Australia’s largest dairy business, Murray Goulburn, partially listed on the Australian Securities Exchange (ASX) today, with shares jumping from its float price of $2.10 to $2.28 within the first hour of trading.
The MG Unit Trust (MGC) listed with an initial capitalisation of $438 million, raised though the issue of 209 million non-voting units to more than 600 new investors.
The float values the entire company at $1.2 billion, with the balance of its shares held by more than 2600 farmers who own the cooperative and supply it with 3.5 billion litres of milk annually.
Another $62 million was raised through the issue of further shares to smaller Murray Goulburn farmers in a priority supplier share offer, before institutions and brokers were able to participate in the partial float.
The new units and shares began trading on a conditional and deferred settlement basis today.
So far, more 4.5 million units have changed hands on the ASX.
In a statement issued to the ASX on the start of trading, Murray Goulburn chief executive Gary Helou said he had a vision for Murray Goulburn to become a “first-choice dairy foods company with global reach”.
“It is fantastic that so many investors share our enthusiasm for creating value by furthering MG’s strategic shift towards premium value-add dairy foods and reducing our exposure to the volatility of the dairy commodity price cycle,” Mr Helou said.
Listen to a podcast interview with Gary Helou
“Importantly, the capital structure strongly aligns the interests of our supplier shareholders and MG Unit Trust investors; we will be working hard to deliver for all our stakeholders.”
Mr Helou said the “successful listing” was a historic day for the 65-year-old cooperative.
“Importantly, we now have the capital to invest in key projects to deliver world leading manufacturing and supply chain capabilities to better connect with domestic and international customers.
“Over the coming months we will move with speed to activate the planned capital projects; (these expansion plans) will a key driver behind MG’s growth and value creation strategy to support sustainably higher farmgate milk prices and returns for MG shareholders and MG Unit Trust unitholders.”
The listing price of $2.10 was at the lowest end of prospectus expectation, which has seen some farmer-owners of the co-operative predict an optimistic $3 to 3.50 per unit price.
But extreme global volatility in current dairy commodity markets, low global milk prices and concerns about dividend yield for new investors in Murray Goulburn deterred some big institutions from backing the float.