Allegro: The Warsaw Stock Exchange never seen such a debut

The share price of auction site Allegro increased by 51.2 percent to EUR 14.51, making it the largest IPO in the history of the Warsaw Stock Exchange (WSE).

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...

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nvestors on the Warsaw Stock Exchange saw over 1.0 bn shares of the e-commerce platform splash down on the market on Monday at 9:15. Already in the first part of the morning the share price has soared from the offer price PLN 43 (EUR 9.60) to PLN 65 (EUR 14.53) giving those who took part in the IPO a profit of 51.2 percent.

A total of 9,342,771 shares were allocated to retail investors and 236,238,624 shares to institutional investors (including additional allotment shares). The offer was massively over-subscribed: the average reduction rate for retail investors was approximately 84.85 percent, which means that if someone applied for 1000 shares, they only received 151.

On September 14, Allegro announced the public offering and debut on the WSE. Despite or maybe with the help of the COVID-19 restrictions on high-street shopping in the spring, the company's profit in the first half of the year increased year on year to PLN 289.7 mln (EUR 65 mln) from PLN 195.7 mln (EUR 44 mln).

The valuation makes Allegro the largest company listed on the exchange, ahead of CD Projekt, the games producer responsible for The Witcher series and the upcoming Cyberpunk 2077 game. CD Projekt itself has leapfrogged giants like copper conglomerate KGHM and PKO Bank Polski.

Founded in 1999 by Surf Stop Shop sp. z o.o., based in Poznań, Western Poland, Allegro was purchased by the South African Naspers group for GBP 950 mln (EUR 1 bn), who then sold it to three venture capital firms: Cinven, Permira and Mid Europa Partners for USD 3.5 bn (EUR 2.95 bn) in 2016.

The company’s name is synonymous in Poland with internet shopping. Nevertheless, Allegro now faces mounting competition from Chinese online shopping sites and the US giant Amazon, which has invested heavily in Poland in logistics for its German operations and is likely to turn its eyes to Poland very soon.