By Anna Banacka and Anna Koper
WARSAW/GDANSK, Poland (Reuters) – Shares in Polish e-commerce group Allegro leapt greater than 60% on their debut on Monday, giving the corporate a market worth of just about $19 billion in Europe’s largest preliminary public providing (IPO) up to now this yr.
Based greater than 20 years in the past as a home-grown rival to eBay, Allegro is central Europe’s most recognised e-commerce model and its web site is attracting 20 million guests a month as shoppers log on in the course of the COVID-19 pandemic.
Allegro’s sturdy begin mirrored the efficiency of some current IPOs in the US the place shares have shot up as buyers confirmed they have been keen to pay for firms with potential for development.
Final month, British e-commerce agency The Hut Group made the largest debut on the London Inventory Change in seven years and Allegro’s profitable launch was an additional signal the European IPO market is choosing up.
Nonetheless, investor urge for food appears to be reserved for tech and development firms – sectors that company Europe is gentle on in comparison with the US, the place a variety of blockbuster tech IPOs have launched this yr.
“The current pandemic highlighted the worth of e-commerce for a client, and accelerated e-commerce penetration,” mentioned Ivan Kim, an analyst at Xtellus Capital. “Allegro is a well-established market … and is already fairly worthwhile.”
Shares in Allegro closed the day at 70 zlotys, up 63% from their IPO worth of 43 zlotys, which was on the higher finish of the steerage vary.
Allegro instantly turned probably the most invaluable firm on the Warsaw bourse, which mentioned the corporate would substitute Commerzbank’s mBank in its index of the 20 largest firms WIG20 after the Oct. 14 buying and selling session.
Poland hopes the preliminary public providing will increase the trade which has struggled to draw new listings and seen a drop in turnover. Polish cellular video games agency Huuuge has introduced plans for a inventory market itemizing.
“In these troublesome instances once we struggle with the pandemic and recession, all of us want excellent news. Allegro’s debut is nice information for all of us,” Deputy Prime Minister Jaroslaw Gowin advised a information convention.
Allegro’s personal fairness homeowners Cinven, Permira and Mid Europa will wish to profit from the IPO momentum with follow-on placements as solely about 25% of the corporate was floated, mentioned Christoph Stanger, co-head of Goldman Sachs’s European fairness capital markets enterprise, which helped organise the itemizing.
“When pricing offers like Allegro, it’s extra vital to construct momentum than to maximise worth on day one,” mentioned Stanger.
Throughout Europe, there are quite a few IPO offers within the pipeline for the primary half of 2021, because the 2020 season is drawing to a detailed and issuers wish to keep away from any potential market turmoil in reference to the U.S. presidential elections on Nov. 3, capital markets bankers have mentioned.
Allegro’s IPO comprised greater than 23.25 million new shares and 190.29 million present ones. Beforehand, the most important firm on the Warsaw trade was video video games producer CD Projekt.
Goldman Sachs, Morgan Stanley, Barclays, Financial institution of America, Citigroup, Santander and BM PKO BP organised the Allegro IPO.
(Reporting by Anna Banacka in Gdansk, Alan Charlish and Anna Koper in Warsaw, Abhinav Ramnarayan in London and Arno Schuetze in Frankfurt; Modifying by Edmund Blair, Mark Potter, Susan Fenton and David Clarke)
Copyright 2020 Thomson Reuters.