Coles shares have floated on the Australian stock market at $12.49, with Wesfarmers’ price adjusting in early trade without the supermarket giant in its stable.
The Supreme Court of Western Australia approved the scheme of arrangement for Coles’ demerger from the Perth-based conglomerate this week, clearing the way for Coles shares to trade on a deferred settlement basis at 1100 AEDT on Wednesday.
Coles shares rose to $13.00 by 1136 AEDT.
Wesfarmers shares fell nearly 30 per cent but CommSec market analyst James Tao told AAP this was a natural correction after about a third of its business had been removed.
‘It’s taking out a fair chunk of Wesfarmers’ earnings and also their market cap, so the fall correlates to the fact Coles has come out of its business,’ he said.
The $20 billion demerger was approved by Wesfarmers shareholders last week at its annual general meeting.
The Coles float may be at the mercy of the Australian share market’s dive to near-two-year lows amid a global stock sell-off, but Mr Tao said he expects the supermarket giant to trade higher.
The supermarket chain’s chief executive Steven Cain said the market’s volatility wasn’t a concern as Coles debuted as its own entity.
‘These things come and go, it’s been soft for a month or more now,’ he told reporters.
‘We’re here for the long term … I certainly won’t be watching the share price every day, I’m here to lead the team that’s going to grow shareholder value over the long term.’
Wesfarmers shares were down $12.89, or 29.2 per cent, to $31.33.