Sonae’s IPO starts today. Here is our Q&A

  • ECO News
  • 8 October 2018

Investors who want in on Sonae's IPO should do so from the 8th to the 17th of October. These ten questions and answers will tell you everything you need to know if you want to invest in this IPO.

No other IPO can compete with Sonae’s this year. Investors who are interested in being part of the race and get a slice of the IPO can do it this Monday.

Today the bidding period for Sonae’s IPO begins, and it extends until the 17th of October. There are several reasons why investors should be part of this transaction, and those interested now have to dot the i’s and cross the t’s to figure out whether this is a good investment opportunity.

Here’s our Q&A, which can potentially help you get rid of those uncertainties:

When does the bidding period begin?

The bidding period kicks off this Monday morning, with applications or offers for the IPO closing on the 17th of October (for small investors) and on the 18th of October (for institutional investors). The final bidding price will be announced on the 18th of October. Shares should have their market debut in Euronext Lisbon by the 23rd of October. However, there will be two separate bidding periods, the first takes place from the 8th to the 12th of October, and the second period goes from the 13th to the 17th of the same month.

How much will Sonae’s shares value?

Sonae MC will sell its shares between €1.40 and €1.65, and the final value will be defined based on the demand registered during the bidding period.

What is the percentage up for bidding?

Sonae is planning to sell around 217 million stocks, which represent 21.7% of the retail company’s volume – and they will be willing to bid a bigger margin of up to 33% if demand is sturdy. Big international investors will take the bigger bite, while institutional and small investors will only have access to 5% of the company’s shares (50 million stocks).

How many stocks can each investor buy?

Referring to the 5% shareholders universe, each small investor will have to buy packages of 10 stocks, with a minimum of 10 and a maximum of 175 thousand shares for each investor.

However, each investor may only deliver a single acquisition order – and in the case that several were presented by the same investor only the highest offer, in terms of the number of shares, will be considered. In order for the biddings to be on an equal basis, this IPO will give priority to those who applied during the first bidding period.

Where can one buy these shares?

CaixaBI and Millenium Investment Banking are the official financial intermediaries for this IPO. But private investors can also give the order for acquisition through any other bank or broker, by phone or online. The only condition is that the financial intermediate is qualified to register with the transaction of transferable securities.

What is the price of subscribing to Sonae’s IPO?

Besides the price of shares, there might be an added commission value to be paid to the financial intermediaries, with each of them having their own pricing. Investors who do not have any securities portfolio also have to take into account that the banking or broker will charge the extra commission for administration services for marketable securities (usually charged every three months). Before doing your offer, you should take all these costs into account.

Until when can an investor cancel its offer?

They cannot be revoked after the 12th of October. From this day forward, the bids can only be altered to increase the initial share value, according to Sonae’s IPO prospect.

What if demand surpasses the offer?

When demand goes over the available share number there is a second apportionment – where the biddings of those who have applied on the first round of biddings will have priority and will be given 100% of the shares available (unless these offers can be satisfied with a lower value).

When will the final results of the IPO be announced?

After the bidding period is over (17th of October for retail investors, 18th for institutional investors), the company will observe the aggregate results from the operation and communicate it to the market, during a special market session which will take place on the 18th of October, which is also the date when the final share value will be announced.

When will shares be attributed to its investors?

The company’s equity trading will start almost certainly on the 23rd of October, according to the IPO documents. That is also the date when the retail investors (5%) will receive their shares.