Mum and dad investors have leapt onboard for the public float of Medibank Private, lining the Government up for a $5.7 billion sale.

Finance Minister Mathias Cormann announced the Medibank sale offer had beaten expectations on the weekend, and looks like raising between $4.3 billion and $5.7 billion on debut this Tuesday.

But the sale means the Government will miss out Medibank’s annual dividend of around $500 million.

Senator Cormann said household investors would pay $2 per share, while institutional investors would pay $2.15.

“We felt it was appropriate to allocate 60 per cent to mums and dads across Australia to ensure that they can appropriately share in the future of Medibank,” he told reporters.

“It’s obviously a win for Australian taxpayers because they have been able to release the capital that was tied up in Medibank.

“We are in a position now to be able to release that capital in job-creating, productivity-enhancing infrastructure.”

Some key fund managers have observed that Australia’s largest private health insurance company may not actually have big growth prospects, but Senator Cormann was focussed instead on the issue of cost-cutting.

Senator Cormann said the proceeds will be spent on infrastructure projects to create jobs.

Medibank Private will make its debut on the ASX on Tuesday at 12pm.