Viva Energy's enthusiasm for the IPO despite a decline in forecasts

The group had forecast a stock price of between $ 2.50 and $ 2.65. It will issue shares at $ 2.50 Friday, valuing Viva at about $ 4.9 billion.

Owner of Viva, the Dutch oil and petroleum company Vitol, has retained a 45 percent stake in the company, raising $ 2.65 billion for the IPO. The remaining 55% was bought by the 55% of investors, the largest investors raised 47% and the retail shareholders 22%.

None of the major holdings held by investors exceed 5%.

Sources close to Viva said that the IPO was very interesting, but that the IPO Morningstar Equity Research still believed that Viva was cautious in its price range. action planned for its prospectus

"We believe that investors can comfortably invest in Viva Energy's initial public offering because its introductory price is below our fair value estimate. $ 3 per share, "said Mark Taylor.

"Based on an indicative price range of $ 2.50 per share, we see reasons to invest in the IPO.

" There are many to love in the Viva sector. It is the second largest supplier of refined fuel in Australia [with] 24 percent of the market of 60 billion liters, second only to the largest Caltex player with its share of about 27 percent [of the market] " The other two main suppliers are BP and Mobil, however, Stuart Baker, a senior badyst at Shaw Stockbroking, believes that although Viva's and Caltex's market share is similar, the company's actual profitability is significantly reduced

"Viva is 14% smaller than Caltex in terms of sales volumes but 46% He added that Viva's sales trends and sales volumes are generally stable or declining overall, with the exception of aviation's aviation fuel business Unlike Caltex's chaotic relationship with Woolworths retail brand service stations, Viva's relationship with retailer Coles since 2003 has been an impetus for investors.

While Caltex recently signed a new 15-year partnership. The Woolworths brand service station, after their relationship briefly collapsed and BP competing for being Woolworths' only fuel supplier, Viva has always provided fuel to Coles Express.

They also stand out as Viva controls leases at Coles Express sites, while Woolworths controls their retail sites, leaving Caltex uncovered if Woolworths changes its agreements.

million. Wyatt said the relationship with Coles would remain one of the pillars of the company. 19659002] "We see great opportunities to continue this growth with Coles in the future," he said.