Auction site IPO to bring Warsaw exchange a new leader

Poland’s leading auction site Allegro’s public offering price of PLN 43 (EUR 9.40) per share gives the company a value of PLN 44 bn, which will make it the largest company on the Warsaw Stock Exchange when the IPO happens in October.

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Allegro’s IPO will consist of an issue of over 23 mln new shares in the company, plus the selloff of over 190 mln shares which made up part of the portfolio of its existing investors, three venture capital firms who bought out South African Naspers in October 2016 for 3.25 bn dollars.

The total value of the 213 mln shares on offer, which make up over 20 percent of the total shares in the company, is valued at PLN 43, just shy of PLN 9.2 bn (EUR 2 bn).

That gives a total value for the company of PLN 44 bn (EUR 9.6 bn), according to analysts.

This means that the Warsaw exchange will have a new largest company. The current market capital of CD Projekt, the game dev firm responsible for the Witcher series and CyberPunk 2077, which is to be launched next month, is currently PLN 43 bn (EUR 9.4 bn).

The game developer itself leapfrogged copper giant KGHM, oil companies Lotos and Orlen and a host of banks like Pekao and PKO SA over the past two years in terms of valuation. Allegro is simply continuing a trend, whereby companies relying on new technology and logistics are floating to the top of the capital pool. Polish retailer Dino is another company, which on the back of carefully planned expansion has grown larger than the old conglomerates.

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The same tendency was seen in the US, where twenty years ago the major industrial and hydrocarbon firms were top of the pile, only to be replaced by the big tech firms.

The next in line for an IPO is InPost, according to reports, a company which works closely with Allegro, in that it runs delivery lockers for items bought online.

Bloomberg reported that venture capital firm Advent, which owns a significant share in InPost, is considering its sale, valuing the company at PLN 9 mln (EUR 2bn).

One observer at the Centre of Anti-monopoly and Regulatory Studies, Dr. Mateusz Chołodecki, considers that InPost would be a tasty morsel for the Polish Postal Service, itself making most of its money on parcel delivery.

The company boasted in July that it has 7,000 delivery locker points, compared to the country’s 4,600 post offices and that 61 percent of Poles prefer packages to be delivered to lockers, up from 52 percent in 2019, though the majority of packages (55 percent) are delivered by couriers.