View more on these topics

Fidelity’s share buying move could stop the stags

Winterflood Securities head of research Simon Elliot says Fidelity’s decision to buy its own shares on an ad hoc basis may prevent investors stagging Anthony Bolton’s China special situations trust.

Fidelity has had a special resolution passed to make market purchases of up to 14.99 per cent of its own issued shares following the conclusion of the offer for subscription and placing.

This allows Fidelity to address any significant imbalance bet-ween share supply and demand in the secondary market and to manage the discount to the NAV at which its shares may be trading.

Stagging is the practice of buying an initial public offering at the offer price and then res-elling once trading has begun, usually for a profit.

Elliot says: “What it will mean is that the premium will not balloon out to extraordinarily high double-digit levels. Additional share capital sitting in the background can be released as and when, so, for example, when it goes into the FTSE All-share and index trackers get involved, there will be shares for them.”

The trust will issue 650 million shares at a share price of 100p and an NAV of 98.9p at launch. Shares worth £400m will be available under the subscription offer, with a further £231m available through a placing. Bolton is to make a £2.5m investment.


Horlick: As with other types of annuities, a capital sum is invested in exchange for a monthly

Immediate response

Partnership managing director of care Chris Horlick explains how buying an immediate needs annuity ensured property assets were not depleted


News and expert analysis straight to your inbox

Sign up


    Leave a comment


    Why register with Money Marketing ?

    Providing trusted insight for professional advisers. Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and advice.

    News & analysis delivered directly to your inbox
    Register today to receive our range of news alerts including daily and weekly briefings

    Money Marketing Events
    Be the first to hear about our industry leading conferences, awards, roundtables and more.

    Research and insight
    Take part in and see the results of Money Marketing's flagship investigations into industry trends.

    Have your say
    Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

    Register now

    Having problems?

    Contact us on +44 (0)20 7292 3712

    Lines are open Monday to Friday 9:00am -5.00pm