Market volatility has forced Bankia to lower the price of its IPO deal by 15% compared to original predictions. The lender had to reduce share values by 3.75 euros to match qualified investors´ demand for shares. The share value was originally between 4.41 and 5.05 euros.
So Bankia will capture 3.4 billion euros, including the "green shoe," equivalent to 10% of the sale allocated to global coordinators who are managing the deal.
Since various institutions maintained that lenders such as Santander, BBVA, Popular, Sabadell or Mapfre analyzed the the Bankia IPO strategy in terms of it creating some stability within the financial system and offering attractive price after the lender?s share price dropped.
Mutua Madrileña admitted to elEconomista that the Delegate Commission of Investments has decided to make a "small investment" on behalf of its financial interest and to support Bankia´s IPO, but it hesitated to announce the exact amount of the investment.
The Spanish risk premium shot up yesterday to more than 370 basis points, complicating negotiations with potential buyers who were confirming acquisition arrangements until noon. Other sources considered it a "success" that the lender could raise more than 3 billion euros under such adverse circumstances. "If we don´t go public, the consequences will be dreadful," they said. With an opening share price of 3.75 euros per share, the firm will begin its life as a public entity with a capitalization of 6.8 billion, which puts it between the fifteen biggest Spanish companies.
