Grey market values FCL's Rubicon at 38 cents

Shares in new Fletcher Challenge offshoot Rubicon traded at 38c in the unofficial grey market this week.

The company - designed as a technology incubator but lumbered with some of Fletcher Challenge's assets that can't find a home elsewhere - is due to start trading on Monday.

Fletcher Energy shareholders will get as part of their payout one Rubicon share for every Energy share they hold.

When Fletcher first mooted the concept of Rubicon in October it said the shares would be worth $1.20 each.

But that was when Capstone shares were worth $US48 ($115) each against $US28 this week.

Rubicon will be financed by the proceeds of around 3 million of Energy's Capstone shares. Fletcher Energy currently holds about 9 per cent of Capstone involving 7.3 million shares.

Although billed as a vehicle for commercialising emerging technologies, a prime function of Rubicon has so far been to help underwrite the recapitalisation of Fletcher Forests.

Rubicon paid $67 million to take up its share of the underwriting of the Forests rights issue.

It should be in the money there, having paid 25c a share against the current price of 33c.

Rubicon may also provide a temporary home for the Challenge chain and Energy's 14 per cent interest in NZ Refining, until suitable buyers can be found.

It will also buy Forest's biotechnology assets including an investment in ArborGen, a 2.9 per cent stake in listed Genesis Research, tree technology operations and its South American forestry assets.

- NZPA