NEW YORK, Dec 15 (Reuters) - Shares of Wells Fargo opened almost 50 minutes late on the New York Stock Exchange on Tuesday as the allocation process for its $10.65 billion equity offer was completed.
Wells Fargo sold the stock in order to raise funds to help repay a $25 billion bailout received from the U.S. government last year.
Underwriters Goldman Sachs said although the offer books closed at 9 a.m. (1400 GMT), the offer had to be allocated globally, including to over 400 institutional accounts.
'We just wanted to make sure the allocation process was completed before trading began to make sure the offer began trading properly,' said a Goldman Sachs spokesperson who asked not to be named.
The large size of the offer may have been the reason it took longer to complete.
The shares were priced at $25 each, about 2 percent below Wells Fargo's closing share price on Monday of $25.49. The offering dilutes existing shareholders by about 10 percent, according to analysts.
The New York Stock Exchange head of press Ray Pellecchia said, 'We held the opening until the underwriting process was complete so all orders could be reflected in the opening price.'
Wells Fargo Stock rose 2.3 percent to $26.08 by midday.
(Reporting by Edward Krudy; Editing by Leslie Adler) Keywords: STOCKS WELLSFARGO (edward.krudy@thomsonreuters.com; Tel: +1 646-223-6314; Reuters Messaging: edward.krudy@reuters.com@reuters.net) COPYRIGHT Copyright Thomson Reuters 2009. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
Wells Fargo sold the stock in order to raise funds to help repay a $25 billion bailout received from the U.S. government last year.
Underwriters Goldman Sachs said although the offer books closed at 9 a.m. (1400 GMT), the offer had to be allocated globally, including to over 400 institutional accounts.
'We just wanted to make sure the allocation process was completed before trading began to make sure the offer began trading properly,' said a Goldman Sachs spokesperson who asked not to be named.
The large size of the offer may have been the reason it took longer to complete.
The shares were priced at $25 each, about 2 percent below Wells Fargo's closing share price on Monday of $25.49. The offering dilutes existing shareholders by about 10 percent, according to analysts.
The New York Stock Exchange head of press Ray Pellecchia said, 'We held the opening until the underwriting process was complete so all orders could be reflected in the opening price.'
Wells Fargo Stock rose 2.3 percent to $26.08 by midday.
(Reporting by Edward Krudy; Editing by Leslie Adler) Keywords: STOCKS WELLSFARGO (edward.krudy@thomsonreuters.com; Tel: +1 646-223-6314; Reuters Messaging: edward.krudy@reuters.com@reuters.net) COPYRIGHT Copyright Thomson Reuters 2009. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
