Lotte Chemical price falls despite stabilisation efforts

  • Business
  • Thursday, 13 Jul 2017

FILE PHOTO: The logo of Lotte Chemical is seen at its building in Seoul, South Korea June 7, 2016. REUTERS/Kim Hong-Ji/File Photo

KUALA LUMPUR: Lotte Chemical Titan Holding Bhd continues to see selling pressure on Thursday despite efforts by the initial public offering’s (IPO) stabilising manager Maybank Investment Bank Bhd (Maybank IB). 

The shares ended their third day of trading on Bursa Malaysia down 8 sen at RM6.40, with 7.05 million shares changing hands. Its IPO price was RM6.50.

In a filing with the stock exchange on Thursday, Maybank IB said it bought 2 million Lotte Chemical shares during the day at an average price of RM6.4329 per share. 

That means it spent a total of RM12.87mil for the day’s price stabilisation or “greenshoe” efforts.

Since Day One, Maybank IB has forked out a total of RM142.92mil to buy 22.12 million Lotte Chemical shares, which translates into an average price of about RM6.46 each.

Under its price-stabilisation mechanism, Maybank IB said it could buy up to 27.77 million shares, representing 4.8% of the total number of shares offered under the IPO, to stabilise the stock’s price. That leaves a balance of 5.65 million shares. 

The maximum period during which it may intervene to stabilise the price of the shares is 30 days from the stock’s debut on Bursa Malaysia.

Ahead of its listing, Lotte Chemical’s IPO was repriced at RM6.50 from RM8 initially due to tepid investor response. 

The company had also reduced the size of its IPO by one-fifth to 580 million shares.
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