Many readers have left comments asking how they will be able to subscribe to the upcoming IPO of Tim Hortons (judging by the number of comments, the IPO is likely going to fly faster off the shelves than Timbits on a weekday morning). Two readers have left some useful comments (the versions below are slightly edited):
It is going to be very hard to get any shares on the IPO because of the high demand. The big institutions will gobble up most of it first and whatever stock is left will go to their very wealthy clients. My advice is to “try” buying it within the first week or two after the IPO or even purchase Wendy’s stock, which is on the NYSE. The demand is going to be so high for the stock the only way the price can go is up in the first few months. Its simple economics guys. Get in and get out with some nice gains.
To answer your questions on whether you as an investor can purchase the Tims Securities through a Discount Brokerage / Online Firm (TD Investorline, BMO Investorline, Scotia Direct ect…), 99.9% NO. The whole placement will be eaten up by institutions (full service firms). 2/3 or the placement will go to institutions in the US, 1/3 will go to Canadian firms. RBC is the lead underwriter in Canada, so if you have a full service brokerage account with them, your chances are slightly better. Most of my clients have expressed interest, and I will only be able to offer to less than a fifth of them. Best option is to purchase on the open market the first week if the price doesn’t deviate to far away from the offer price.
Thank you Nick and Rob for your comments. The comments confirm my suspicion that retail investors would have to buy the shares in the open market after it starts trading. Given the relatively small size of the offering, the high demand for the shares and the strong performance of the Tim Hortons chain, I am going to give this stock a pass.
