First Active will begin trading on the Dublin and London markets on October 6th with shares in the former building society expected to be valued at between 265p and 380p.

For the 216,000 members of the former First National building society who qualify for free shares, the valuation means their windfall could be worth between £1,170 and £1,710. It also values First Active at between £387 million and £510 million.

When the flotation was announced last May, its stockbrokers indicated the shares would be worth 260p each, depending on market conditions. The huge range now being predicted for the share price is said to reflect the current volatile conditions in world stock markets with analysts hopeful the shares will be offered closer to the higher value.

Through the flotation, First Active is seeking to raise £104 million of new capital by issuing new shares to qualifying members - who include account holders and employees - and institutional investors. After expenses this leaves £83 million worth of shares which can be purchased in equal proportions by both groups.

Unlike flotations such as Norwich Union, First Active has capped the amount of shares that members can apply for to £5,000 for each qualifying account. So anyone who qualifies for two allocations of free shares, say through qualifying savings and mortgage accounts, can apply to buy £10,000 worth of First Active shares when it floats.

But even at such a low limit many members may be disappointed, receiving less than £5,000 shares if for instance a majority of those entitled to subscribe took up the option.

First Active group managing director, Mr John Smyth, said in this scenario the group would have to scale back on the amount of shares that could be issued to its members. "We decided this is the fairest way of handling the new share offer to members rather than leaving it up to them to decide how many shares they wanted to subscribe for," he said yesterday.

First Active will be sending out its mini prospectus and details of how to claim and subscribe for its shares to members over the next week. The 216,000 qualifying members are entitled to an allocation of 450 free shares per qualifying account. A further 100,000 members who failed to qualify will receive a small cash payment.

To claim free shares, members must return their completed forms to First Active's receiving agent in Dublin before 3 p.m. on September 29th.

The actual price at which the shares will be issued and begin trading on the Dublin and London markets will be determined over the next three weeks. First Active will begin a series of roadshow presentations to the various institutional investors on Monday and they will then be invited to make bids to the society indicating the price at which they wish to purchase the shares. The bids will be forwarded to First Active before Friday, October 2nd and a price will then be decided on by the board of directors. Members will be notified of the issue price the day before the flotation.