With liquidity at record levels and the economy picking up, it’s an ideal time for a company to list on the South Pacific Stock Exchange (SPX), said SUN Insurance independent director Inia Naiyaga.
SUN Insurance announced this week its Initial Public Offering (IPO) of seven million shares at $1.05 a share, a decision made to help diversify its business and give back to Fijians after 25 years of service to Fiji.
“The timing is good. It’s good because of two things: one, there’s a lot of liquidity in the market. Secondly, there is a very low interest rate in the market, meaning that interest rates of bank savings and term deposits are low, so it’s better for people to invest in shares or some other investments,” Mr. Naiyaga said.
The SUN IPO will close at the end of the month followed by two weeks of share allotment, with the flotation of 120 million ordinary shares on SPX scheduled for August 15.
Upon listing, SUN will be the 20th company to list and will end a five-year listing drought on SPX; the last company that went public was Port Denarau Marina in 2019.
Naiyaga emphasized the need for more companies to list to increase liquidity in trading.
“There is growing interest in the stock market and more and more people are taking an interest in it and buying shares,” the former deputy Reserve Bank of Fiji governor said.
“The problem is a lot of those who are buying shares at the stock exchange tend to hold on to the shares. They are institutional investors, so that’s what they do. That’s why if there are more companies listed on the exchange, more shares are available for people to buy. However, it’s not an easy exercise to list on the stock market and I understand the stock exchange is reviewing the listing rules to make it simpler for companies to list.”
The SUN Insurance IPO prospectus is now available on the SPX website.