Shares in Oceania soar 300pc
Oceania Natural’s boss and major shareholder is ‘‘delighted’’ after shares surged 300 per cent within a few days of listing.
The New Zealand Exchange is aware of the rapid rise, but has not issued a ‘‘please explain’’ notice.
The food supplement firm joined the market in a compliance listing last week, with shares initially valued at 64 cents each.
Within three days of listing the share price had soared as high as $2.65, and was trading at $2.32 yesterday afternoon.
That took Oceania Natural’s value from about $16 million to a market capitalisation of $60m, representing a huge gain on paper for existing shareholders.
Chief executive Walker Zhong confirmed the company was in compliance with its disclosure obligations, with current information found in the listing document and Edison research report.
‘‘Oceania is delighted to now be listed on the NXT and to be receiving such strong investor support."
Oceania Natural was listed on the NZX’s fledgling NXT board for smaller businesses, which has a simplified process and regulatory framework.
An NZX spokeswoman said companies listed on NXT were subject to the same regulatory oversight and frontline trade monitoring as those on the NZX main board.
She said the NZX was aware of the increased share price. ‘‘NZX is unable to speculate on whether it may issue a price enquiry in respect of those circumstances, other than to note that any price enquiry process would be public.’’
The rapid rise has been on the back of small trading volumes, with only about $250,000 worth of shares changing hands.
Just over 70 per cent of Oceania Natural’s shares are held by interests associated with Zhong and non-executive director Zhongyang Meng. However, the holdings are locked up in escrow agreements until February 2018.
The company is expecting revenue of $3.4m in the 2016 financial year, forecast to grow to $5.4m in 2017.