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To: Serge Collins who wrote (7495)	11/19/1998 1:19:00 AM
From: pat mudge	Respond to of 18016

WEDNESDAY NOVEMBER 18 1998 Asia-Pacific TELECOMS: Optus in strong Australian debut By Gwen Robinson in Sydney The Australian stock market debut of Cable and Wireless Optus, Australia's second largest telecommunications group, exceeded expectations, ending yesterday at A$2.65 per share. The closing price was up 4 cents from the listing price of A$2.61 and well above analysts' forecasts of A$2.50. It represented a 43 per cent premium to the A$1.85 price offered to retail investors and 23 per cent above the final institutional price of A$2.15 in the A$2.44bn (US$1.56bn) initial public offering. Optus, which is controlled by Cable and Wireless of the UK with a 52.8 per cent stake, ended the day with a market capitalisation of about A$9.2bn, putting it in the top 10 listed Australian companies. The success of the float reflected strong interest from overseas institutions, which accounted for nearly two-thirds of the 375m shares offered to institutions ahead of the listing. It also highlighted the profound shift in investor interest away from resources stocks, which traditionally dominated the Australian Stock Exchange, towards telecommunications and financial stocks, which have outshone other sectors and led the market's most successful IPOs in the past year. The institutional offer for Optus was heavily over-subscribed, with US and European institutions the heaviest bidders. Cable and Wireless, which subscribed to nearly half the shares issued or sold, made a nominal profit of about A$1.8bn, analysts said. Since Optus was established in 1992, the UK company has invested about A$3bn, including a recent move to increase its stake from about 49 per cent to nearly 53 per cent. Warburg Dillon Read and Merrill Lynch, joint global co-ordinators of the issue, were believed to have handled most of the day's trading volume of 305m shares. The Optus float took place on the first anniversary of the one-third privatisation of Telstra, Australia's largest telecommunications company and Optus's main rival. Since the successful partial listing, Telstra's share price has nearly doubled. Optus's premium on Tuesday of 43 per cent outstripped Telstra's 37 per cent premium a year ago, but analysts believe the Optus share price lacks the same growth potential.