Aussie LMI company shares rocket

by AB21 May 2014
The shares of lenders mortgage insurer Genworth Australia have rocketed on its first day of trading yesterday.

Strong investor demand saw the shares shoot up on the Australian Securities Exchange 13.2% higher to close at $3, jumping from the $2.65 initial opening price at noon.

US-based Genworth Financial Group raised $583 million by selling off a chunk of its Australian lenders mortgage insurance arm last week, in Australia’s biggest initial public offering of this year.

Investors paid $2.65 for the stock in the IPO.

Genworth sold 34% of Genworth Australia and is still the majority shareholder.

Genworth Australia has a capital base of $2.6 billion, made up mainly of equity that at the beginning of this year represented 1.43 times its prescribed capital.

The company says it has been profitable 46 out of the past 48 years and posted a net profit of $179.4m in 2013.

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