Why there is only upside in pre-registering for Medibank Private shares now

Both Commonwealth Bank of Australia (ASX:CBA) and CSL Limited (ASX:CSL) demonstrate the significant upside potential available when government-owned enterprises are floated on the ASX.

a woman

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

There are many investors still smarting from not participating in the first share offer of the government-owned Commonwealth Bank of Australia (ASX: CBA) in 1991 and the CSL Limited (ASX: CSL) float in 1994. Excluding dividends, the former has appreciated 1,200%, while the latter has appreciated a staggering 3,095%. Over the same time periods the S&P/ASX 200 Index (INDEXASX: XJO) has risen 272% and 164% respectively.

Some Medibank Private facts:

Medibank Private is currently owned by the Australian government and is the largest private health insurer with a 29.5% market share. BUPA is slightly smaller with a 27% share in a highly concentrated industry where five funds have an 83% share of the market. NIB Holdings Limited (ASX: NHF) is the only other publicly listed company and ranks fourth in terms of market share. After listing in November 2007, its shares have appreciated 244%, despite the S&P/ASX 200 Index falling 17%.

NIB and financial services company AMP Limited (ASX: AMP) were mutual funds that were changing structure when they floated. This allowed policyholders to obtain free shares. However, in passing from taxpayer hands to a listed entity, there are no free shares allocated to Medibank Private customers.

What is the order of preferential share allocation after pre-registering?

1. Eligible policyholders (private customers) will receive a greater share allocation.

2. Non policyholders will receive a preferential allocation by comparison with…

3. Non policyholders who failed to pre-register.

Are there any disadvantages in pre-registering?

Pre-registering ensures that you will be notified when the prospectus is ready. It carries no obligation to proceed with purchasing the shares. However, should you choose to apply for shares you will receive a preferential allocation.

How do I pre-register?

You may pre-register anytime from today until October 15 by completing the form that may be accessed by clicking on this link.      

Motley Fool contributor Mark Woodruff does not own shares in any of the companies mentioned in this article.

More on ⏸️ Investing

Close up of baby looking puzzled
Retail Shares

What has happened to the Baby Bunting (ASX:BBN) share price this year?

It's been a volatile year so far for the Aussie nursery retailer. We take a closer look

Read more »

woman holds sign saying 'we need change' at climate change protest
ETFs

3 ASX ETFs that invest in companies fighting climate change

If you want to shift some of your investments into more ethical companies, exchange-traded funds can offer a good option

Read more »

a jewellery store attendant stands at a cabinet displaying opulent necklaces and earrings featuring diamonds and precious stones.
⏸️ Investing

The Michael Hill (ASX: MHJ) share price poised for growth

Investors will be keeping an eye on the Michael Hill International Limited (ASX: MHJ) share price today. The keen interest…

Read more »

ASX shares buy unstoppable asx share price represented by man in superman cape pointing skyward
⏸️ Investing

The Atomos (ASX:AMS) share price is up 15% in a week

The Atomos (ASX: AMS) share price has surged 15% this week. Let's look at what's ahead as the company build…

Read more »

Two people in suits arm wrestle on a black and white chess board.
Retail Shares

How does the Temple & Webster (ASX:TPW) share price stack up against Nick Scali (ASX:NCK)?

How does the Temple & Webster (ASX: TPW) share price stack up against rival furniture retailer Nick Scali Limited (ASX:…

Read more »

A medical researcher works on a bichip, indicating share price movement in ASX tech companies
Healthcare Shares

The Aroa (ASX:ARX) share price has surged 60% since its IPO

The Aroa (ASX:ARX) share price has surged 60% since the Polynovo (ASX: PNV) competitor listed on the ASX in July.…

Read more »

asx investor daydreaming about US shares
⏸️ How to Invest

How to buy US shares from Australia right now

If you have been wondering how to buy US shares from Australia to gain exposure from the highly topical market,…

Read more »

⏸️ Investing

Why Fox (NASDAQ:FOX) might hurt News Corp (ASX:NWS) shareholders

News Corporation (ASX: NWS) might be facing some existential threats from its American cousins over the riots on 6 January

Read more »