Shares in Medibank Private have made a solid start to trading on the stock market, debuting at $2.22.
Mum and dad investors had paid $2 a share ahead of the health insurer’s much-anticipated $5.7bn stock market listing on Tuesday.
The stock made its strong debut amid widespread slides on the overall market on Tuesday.
The federal government raised $5.7bn from selling off Medibank, $1bn more than the Coalition had forecast. All the money will be tipped into the government’s so-called asset recycling fund, which helps pay the states and territories to sell assets and use the proceeds to build new infrastructure like roads.
The shares were at $2.20 each at 1207 AEDT.
Medibank’s managing director, George Savvides, said the interest from investors had been overwhelming and Medibank now had about 440,000 shareholders.
“Up until today there have been relatively limited opportunities to invest in private health insurance as a sector,” he said. “[Investors now have] the ability to invest in an ASX top 100 private health insurer.”
The finance minister, Mathias Cormann, said he was “very satisfied” with the Medibank float. He said the privatisation was a “win-win” for Medibank policyholders and taxpayers.
“It’s a win for Medibank Private policyholders because we believe Medibank Private in private hands will perform even better than under government ownership because they will have more flexibility to pursue growth opportunities into the future,” he said.
“It’s a win for all Australians with private health insurance and indeed it’s a win for all Australians seeking affordable access to high quality health care ... and of course it’s a win for taxpayers.”
Medibank was the highest traded stock on the Australian market at 1242 AEDT, 259m shares having changed hands.
CMC Markets sales trader Will Leys said Medibank’s stock market float had been a good result.
“There has been quite a build-up and excitement amongst the general public,” he said in a note to clients. “The sheer size of the listing, combined with the fact that has been part of Australian landscape for so long, justifies the attention it’s receiving.”
