Britain's Standard Life is set to price its initial public offer today at around 230p a share, valuing the firm at almost £4.7 billion pounds ($8.6 billion) ahead of Monday's debut, a source close to the matter said.
Sources familiar with the matter had said on Thursday, after order books closed, that the price was expected to be set at the higher end of a 220-230p range, helped by strong retail demand, with members of Europe's largest mutual insurer seeking to buy up at a discounted rate.
Market sources said that both retail and institutional order books were oversubscribed.
At 230p the price would be near the bottom of a 210-270p range set by Standard Life last month, when weak markets forced it to trim an April trading range of 240-290p.
But it would still make Standard Life the fifth-largest UK-listed insurer and propel it into the FTSE bluechip index. Standard Life had no immediate comment on the pricing.
A board meeting was under way this morning, and executives were expected to set the final IPO price and to fix the allocation of shares among retail and institutional investors, before releasing a decision by mid to late afternoon.
Monday's market debut, the biggest UK initial public offering since Dimension Data in 2000, ends 80 years of mutual ownership for Standard Life, the UK's last major customer-owned insurer.
Long a staunch defender of mutuality, Standard Life's management made a volte-face in 2004, after three years of equity bear markets battered its core with-profits products and tough new capital requirements were introduced.
At 230p per share, Standard Life would be listing at roughly 0.9 times its embedded value (EV)-- an industry measure that values how much a life insurer is worth to shareholders - which would be at a discount to its rivals.