Subdued debut by PGG Wrightson

Rural services mega-company PGG Wrightson made a subdued debut on the sharemarket yesterday.

After the excitement that surrounded the merger deal when it was announced in July, the actual listing had been "a bit of an anti-climax", said ABN Amro Craigs broker Mark Lister.

The relative volumes of the shares to be allocated to existing PGG and Wrightson holders meant the value of the new company was well flagged.

Initial trades yesterday were within a few cents of those expectations, Lister said.

Once the calculations were done, the new company had been expected to begin trading at $2.17.

It debuted yesterday at about $2.14, trading as high as $2.20 before closing at $2.15.

Most people who wanted in on the merger would probably have bought shares in either PGG or Wrightson over the past few weeks, knowing full well what the likely value was, Lister said.

The market would now be watching to see how quickly the company could extract its forecast merger benefits. About $10 million worth are expected in the first year although they will initially be offset by merger costs.

PGG Wrightson will have annual revenue of about $1.1 billion.

It is 30 per cent owned by Craig Norgate's Rural Portfolio Investments and 22 per cent owned by Pyne Gould Corp.