UK estate agent Foxtons makes $1.2 billion stock market debut
By Kylie MacLellan
LONDON (Reuters) - British property agent Foxtons (FOXT.L: Quote) enjoyed a strong stock market debut on Friday, seeing its stock rise well above its offer price in what could be seen as a vote of confidence in the housing market particularly in London where Foxtons is focused.
Shrugging off some concerns that its core property market might be overheating, the shares opened 19 percent above the 230 pence offer price - itself at the top of a targeted range between 190p and 230p - to value the company at around 775 million pounds ($1.2 billion).
By 1425 GMT they were trading at 271.5p.
Foxtons sold 60 percent of its equity to become the latest UK property-related company to float on the back of a recovering housing market, following real estate agency Countrywide (CWD.L: Quote) and housebuilder Crest Nicholson (CRST.L: Quote) earlier this year.
Both have seen their shares rise more than 50 percent since going public, but some investors said last week Foxtons was late to the party and too exposed to London.
While Britain's housing market has been boosted by signs of an improving economy as well as help from the government and the Bank of England to ease access to finance, the pace of recovery has raised concerns about a new property bubble.
Data last week showed British house prices recorded their fastest rise in almost seven years.
However, despite being wary of proposed further government stimulus measures, housebuilding analyst Tony Williams said London was not yet experiencing a market bubble and rising interest rates in coming years would act as a natural brake. Continued...