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More than 80% of members miss out on special treatment in Medibank Private IPO

If you are a member of health insurer Medibank Private or ahm, you’ve more than likely missed your chance to receive special treatment when the company lists on the ASX.

Just 15.5% of members have pre-registered for the IPO, with 278,732 members out of 1.8 million policies. Pre-registration closed yesterday, which means more than 1.5 million policyholders will be offered shares on the same basis as the rest of the public.

Finance Minister Matthias Corman says 750,494 Australians have registered their details to receive a copy of the prospectus, and the numbers “indicates a strong level of interest in the Medibank Private share offer.” His office also said the numbers had surpassed their expectations.

What is disappointing for me is that so few Australians bothered to pre-register. At this stage, we don’t know what special treatment Medibank Private members will get, although the Australian Financial Review (AFR) suggests they will receive a preferential allocation of shares if the IPO is oversubscribed.

I’m tipping the IPO will be heavily oversubscribed by institutional and professional investors as well as retail investors – I outlined a number of reasons why it will be popular in this article last week. That is likely to see Medibank members, who failed to pre-register, suffer significant scale back of their application for shares.

The prospectus will be lodged with the Australian Securities and Investment Commission (ASIC) on Monday, October 20 for review, with the listing date brought forward to late November, from December.

The general public offer will likely open on Monday, October 27 and run until the middle of November, followed by an institutional offer. There will also be a broker firm offer, where brokers can bid for an allocation of shares on behalf of their clients.

If you pre-registered, you can now sit back until Monday and enjoy the feeling that you won’t miss out.

Editor’s Note: This article has been amended after feedback from the Department of Finance. Previously it stated that 7.3% of members have registered, but the correct percentage is 15.5% – as there was only one pre-registration allowed per policy. Medibank has 3.8 million members, but 1.8 million policies.

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Motley Fool writer/analyst Mike King is a member of Medibank Private and has registered for the share offer. You can follow Mike on Twitter @TMFKinga

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