Cambian is 2014's most under-hyped IPO

IPO WATCH: Cambian's unusual decision to not shout about its IPO looks like a good idea given its shares have already fallen.

by Rachel Savage
Last Updated: 22 Apr 2014

For a company planning to go public, it was all rather hush hush. Cambian, which runs children’s and old people’s homes and provides other specialist health services, announced its intention to float bang on Budget day, guaranteeing it almost zero coverage. Then it priced its shares right at the bottom of the 225p-290p range yesterday, valuing the company at £387.8m ahead of conditional trading starting today.
 
The uber low-key IPO sticks out like a sore thumb amid the froth-tastic exuberance of recent floats. After all, why wouldn’t you shout it from the rooftops publicly if you’re, er, going public?
 
However, with techy stock market debutantes such as AO.com and Just Eat tanking this week after floating at ridiculously high earnings multiples, and stock markets across the world taking a hammering, Cambian’s understated listing is looking rather sensible.
 
Moreover, the company has a few warts that it would probably prefer to hide – unsurprising given the scandal-spawning nature of children’s homes, mental healthcare services et al. A recent Ofsted report found 20% of the 135 homes run by The Advanced Childcare Group (which Cambian announced it merged with today) were only ‘adequate’ (as opposed to ‘good’ or ‘outstanding’).
 
Investors are taking a pretty sober view of the company too: shares are currently down 12% to 198p. Any other companies wanting to cash in on the seemingly fast-waning IPO fever, that only a few weeks ago was looking bubblier than champagne, had better take note.

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