Feb. 25 (Bloomberg) -- McColl’s Retail Group Plc shares fell from the initial public offering price in London as the stock market gave a muted reception to the U.K. operator of convenience stores and newsagents.
The shares traded at 184 pence as of 9:12 a.m., compared with the 191 pence offer price. That gave the company a market value of about 193 million pounds ($321 million). The FTSE 100 Index fell 0.5 percent.
McColl’s is the first of several U.K. retailers to go public in London this year amid a recovering economy and improving consumer confidence. Discounter Poundland Group Plc, online appliances seller AO Plc and Pets at Home have all started an IPO process, with others set to follow.
“Maybe investors were more excited by the other retailing IPOs coming down the line?” Nick Bubb, an independent retailing analyst, said by e-mail today.
Shareholders including the retailer’s executive directors and Cavendish Square Partners sold 83.1 million pounds of stock in the IPO after “strong” interest from investors, Brentwood, England-based McColl’s said today in a statement. The operator of more than 1,200 shops also said it raised 49.7 million pounds by selling new shares to pay down debt.
The IPO “will enable us to accelerate our growth strategy, further enhancing our position in a rapidly growing convenience market,” Chairman and Chief Executive Officer James Lancaster said in the statement.
The retailer is seeking to benefit from a shift in U.K. consumer habits away from big weekly trips to the supermarkets and toward more frequent visits to convenience stores. Convenience stores now account for about a fifth of the grocery industry and are growing at more than 5 percent a year, according to Institute of Grocery Distribution data.
Numis Securities acted for McColl’s in the IPO, with Livingstone Partners LLP providing financial advice.
To contact the reporter on this story: Paul Jarvis in London at firstname.lastname@example.org
To contact the editor responsible for this story: Celeste Perri at email@example.com