HHG makes solid Australian debut
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AMP put on 2.2 percent Tuesday as HHG made its debut.
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SYDNEY, Australia (CNN) -- HHG, the British life insurer and funds manager spun off from AMP, has made a solid debut on the Australian market.
The company opened Tuesday at Aust. $0.88, 22 percent above the A$0.72 price implied in its A$455 million (£190 million) global equity raising.
The amount raised was almost double the £100 million minimum it was seeking.
Analysts said the HHG capital raising, completed over the weekend, was priced well below the company's likely A$1.00-1.40 market valuation. AMP directors have valued HHG at up to A$1.80.
HHG shares closed at A$0.89 Tuesday, while AMP put on another 2.23 percent to A$5.05. The A$5.94 total price for the two companies compares with AMP's final price of A$5.77 immediately before the demerger.
As part of that demerger, shareholders in the old AMP received one HHG share for each AMP share they held.
HHG includes the Henderson funds management arm in the UK, plus the life funds Pearl, NPI and London Life, financial planner Towry Law and Virgin Money.
The "new" AMP covers the Australian and New Zealand insurance and wealth management businesses.
AMP, Australia's biggest life insurer and funds manager, decided to spin off its loss-making U.K. businesses after they ran into trouble because of the sharp fall in global equities in 2001 and 2002.
In August this year, AMP posted a first-half loss of A$2.16 billion, hit by heavy writedowns on the its U.K. operations.
HHG will begin trading on the London Stock Exchange later Tuesday.
