Property website Zoopla float to value site at £919 million

UK property web site Zoopla had priced its flotation in the lower half of its proposed range, valuing the property website lower than the £1 billion it was seeking.

According to the website it would sell 38.3 per cent of its share capital at 220p a share, which would see its market value at £919 million.

The company last month set the price range for the initial public offering (IPO) at 200p to 250p.

The early conditional dealing saw the shares increase 5.5 per cent to 232p, the online trading firm said. The rise means Zoopla had  avoided the early embarrassment of its shares falling when trading started.

Unconditional dealing in the shares is set to start on 23 June.

As no new shares were on offer, the proceeds would go to existing shareholders.

The IPO values Zoopla founder Alex Chesterman's 8-per cent stake at £73 million. He had sold 3.5 per cent, netting £32 million, and would hold on to the remaining stake for at least a year.

According to commentators Zoopla's strong debut signalled that the market for new issues in the UK was strong.

Early conditional trading saw Zoopla shares change hands at as much as 236p each, after having been floated at 220p a share, in between the targeted range of 200-250p which gave the estate agents portal a market capitalisation of around £919 million.

The successful float would see previous majority owner Daily Mail & General Trust make as much as £190 million, with estate agency chains Countrywide and LSL Property Services raising nearly £20 million each from the sale of shares in the initial public offering (IPO).

According to Alex Chesterman, Zoopla's founder and chief executive officer, the IPO had received a 'significant level of institutional investor support'.