Saga is raising £550m in the initial public offering to pay back debt. The new shares represent 27pc of the Saga share captal, valuing the company at £2.1bn.
The float price represents a drastic scaling back of expectations – it is almost 25pc below the top of the original 185p-245p price range.
Shares in Saga edged higher in early trading to 188.5p. Ahead of the float, trading on the "grey market" suggested Saga investors would not make big instant profits such as those seen in the Royal Mail IPO when the shares rose 87pc on its market debut.
Half of the shares went to retail investors, with customers getting preference, and the rest to institutions.
Saga said it had deliberately scaled by the offer for institutions to get customers preference. "It was scaled back to drive the after market," a spokesman said, adding that the offer was three times over-subscribed.
The company begins conditional trading on Friday under the ticker SAGA amid fears that investor appetite for initial public offerings is fading after disappointing market debuts by retailers such as Card Factory, AO World, and online food ordering service Just Eat and the scrapping of the Fat Face flotation due to "market conditions" on Thursday.
Acromas, the controlling shareholder of the Saga, had planned to raise £315m via the sale of part of its holding in a secondary listing, according to the IPO prospectus. Those plans have been scrapped, amid reports that institutions were wary of buying the shares. Acromas could raise up to £82m if an over-allotment option is exercised.
Despite fears of flotation fatigue, London experienced its busiest day for IPOs since 2007 on Thursday. Property website Zoopla, high street discounter B&M Bargains, low–cost carrier Wizz Air and advisory firm River and Mercantile Group all unveiled plans to list on the London stock exchange.
On Friday international budget hotel brand easyHotel, a wholly-owned subsidiary of the easyGroup, said it planned ton raise £60m in an IPO. It has 20 hotels across Europe, South Africa and the United Arab Emirates, with roughly 1,600 rooms in total.
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