OFM hits early success on stock market

OFM Investment Group, the financial services and property investments company which came about as part of the demutualisation of the Over 50s Mutual Friendly Society, has listed this morning with the price exceeding the group’s expectations and climbing to $1.75 by 1pm.

The shares had hit a high of $1.86 earlier in the day but OFM says the figure at 1pm was still outside the range expected by the group which was between $1.37 and $1.65 per share.

These figures are based on the groups Net Tangible Assets (NTA) at December 31 last year and embedded value at demutualisation according to actuarial group, William M Mercer, respectively.

OFM chief executive Michael Rehak said before the float that the group was confident of the share price moving to a high position soon after listing.

"We are confident we are offering a good, solid, growth-oriented stock with substance and a deliverable dividend stream. We hope that the market will judge us favourably on these strong fundamentals," Rehak said.

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The float of OFM will, according to Rehak, allow the group to invest more favourably on behalf of shareholders and provides a market for shares issued to members at the time of demutualisation.

Rehak did emphasise the listing was not to raise capital as after demutualisation, 40 million shares were on issue giving the group a capitalisation of more than $54 million.

The group’s embedded value at the time of demutualisation was higher and calculated by Mercer as $65.8 million and based on the 40 million shares issued to members, results in the embedded share value of $1.65.