Vol. 505 No. 1
11 Mr. Yates asked the Minister for Public Enterprise if she will ensure every person who registers to purchase Telecom Éireann shares under the initial public offering will be guaranteed up to £3,000 worth of shares and, through this, a decision to ensure the retail market will be able to receive priority treatment in the allocation of shares. [12545/99]
It is too early to speculate about the allocations as these will not take place until closer to the launch. As I stated last week in the debate on the general principles of the Telecom Éireann IPO, I want to ensure every citizen in the State is given a fair opportunity to participate. While the details of the retail offer have yet to be decided, I can confirm that there will be a significant tranche of shares for retail investors. I would like to see a greater allocation to the Irish public than in other cases to date but this will be decided by Government at the appropriate time. It would be my intention also to structure the retail offer with the small investor in mind. There must be an equitable balance between the retail and institutional offerings. It is the market which will decide the value of the company. The institutional offer needs to be sufficient to encourage investors to participate.
Will the Minister give a commitment that everybody who registers – I understand perhaps in excess of one million will do so – will be guaranteed at least a fixed option up to a certain level? Even if the figure is £1,000, which is somewhat less than I would have liked, will the Minister include such a provision in the memorandum she brings to Government? I appreciate it is a Government decision. Does the Minister accept her £40 million advisers, as I like to call them, have a vested interest in having a number of tranches of sales? The Minister has up to 50.1 per cent to sell. If this is the best opportunity, given that one million have registered and their only preference is to be ahead of those who have not – there will be few people who will not have registered – will the Minister ensure that as much of the stake as possible is sold to facili tate at least £1,000 for everyone who registers, if they want it?
I cannot possibly give details of a memorandum which I have yet to prepare, as that would be extraordinary behaviour. I am aware the advisers, at whatever price they finally square off, would have an inclination towards a particular type of investor. Therefore, it is my job as the political mover of the matter to ensure the small retail investor gets a chance. I will give the exact number who have registered in response to another question. I believe registration closes on Friday. If there is over-subscription, those who have registered will get first call.
Is the Minister aware that in other privatisations across Europe substantial windfall profits were made by those who bought shares in the public listing, IPO, such as this, and subsequently had the opportunity to trade upwards? Does she consider it politically acceptable that fat cat city slick stockbrokers in Manhattan, London and Geneva might make a killing on an asset that is already publicly owned and paid for by the Irish public? Does she consider it politically acceptable that those fat cat stockbrokers should have the same chance of buying shares as the Irish public?
No, because I have no time for fat cats. That has been my stated opinion from the start.
Why does the Minister not give a guarantee?
Under the legal structures of Government, I cannot disclose the content of a memorandum which has yet to be written and on which I have very strong thoughts. Small investors, who have shown, by registering, that they have a keen interest in what will happen, should have their chance in this flotation. I believe the memorandum I will bring to Cabinet will reflect my views.
