qrn over-allocation option and stabilisation

My understanding from the price sensitive announcement yesterday is that the Joint Lead Managers have, since the listing of QRN on November 22, purchased another 6% of shares from the Queensland Government off-market.

This option was available to them in case there was an "over-allocation" of shares or high demand.

The seems to contradict the pre-listing reality, which saw low domestic institutional demand for shares, with a large percentage going to foreign investors, and a low issue price of $2.55.

It seems to me that this "over-allocation option" gave the Joint Lead Managers the option of not committing to the float and waiting to see how the market reacted before securing shares at the low price of $2.55!

It should be noted that this did benefit retail investors as it meant a low issue price of $2.55 with a 10 cent discount to $2.45. But probably didnt benefit the seller, the Queensland Government who suffered a reduced pre-listing demand for the shares with institutions taking a wait and see approach with the knowledge they could secure an additional 6% in favourable market conditions.

Now that the JLMs have sucked up the additional 6% of shares, it has also taken the green shoe or stabilisation option off the table.

Given that many retail investors have been forced to hold their shares till December 6-7, with no green shoe mechanism, they now have less certainty they will be in the black over the coming weeks.

What do you guys think of this situation?

Dreamcatcher