The IPOX® Update 3/6/24

Klarna Shareholders Propose Dual-Class Share Structure for Post-IPO Control

Swedish fintech firm Klarna's shareholders, including CEO Sebastian Siemiatkowski and Sequoia Capital, are proposing a dual-class share structure to maintain control following the company's potential IPO. The proposal aims to prioritize long-term success over short-term profits, with Siemiatkowski supporting the removal of current special rights for a fairer structure. However, co-founder Victor Jacobsson opposes granting special shares to select individuals. Critics argue that dual-class shares can negatively impact governance, drawing comparisons to Meta Platforms. Klarna, once valued at $45.6 billion, saw its valuation drop to $6.7 billion amid market changes. The company has not yet announced a specific timeline for its IPO. (Source)

Galderma Targets Zurich IPO, Aiming to Raise $2.3 Billion

Swiss skincare company Galderma is preparing for an IPO in Zurich, with plans to raise $2.3 billion within the next 3-4 weeks. The company sees the Asia-Pacific region, particularly China, as a key growth territory despite challenges faced by rivals. In 2023, Galderma reported net sales of $4.08 billion, an 8.5% increase in constant currency, with international markets (excluding the U.S.) growing by 12%. The IPO proceeds will be used for debt repayment and refinancing. The offering could value Galderma at over $15 billion, potentially making it the largest IPO in 2024 to date. The company targets 7-10% sales growth and a 23.1% EBITDA margin for 2024, with long-term above-market growth. (Source)

CVC Capital Partners Eyes Amsterdam IPO, Potentially Europe's Largest

CVC Capital Partners, Europe's largest buyout firm, is reviving plans for an IPO in Amsterdam, with a potential listing of over $15 billion that could materialize as early as next month. The decision to proceed with the IPO is not yet final, and there is a possibility of delay until spring or early summer. CVC had initially planned to raise €1 billion ($1.09 billion) in an IPO last November, which was set to be Europe's largest, but postponed due to "unfavorable market conditions." The firm currently manages approximately €188 billion in assets under management. Sky News reported the revival of IPO plans, citing unnamed sources. (Source)

UK Government Launches "British ISA" to Boost Domestic Equity Investment

The UK government has introduced a new savings account called the "British ISA" to encourage investment in domestic equities amid a slump in IPOs. The measure is part of a broader effort to revive London as a leading global financial hub and attract more listings. Chancellor Jeremy Hunt emphasizes a focus on returns rather than costs for pension providers, addressing concerns over the relatively low level of domestic stock investments by UK pension funds compared to international standards. These policies are intended to stimulate economic growth and capital market activity. Additionally, the government is releasing funds to transform the Canary Wharf finance district into a hub for life sciences. (Source)

Santander-Backed Ebury Eyes £2 Billion London IPO

Ebury, a cross-border trading platform backed by Spanish banking group Banco Santander, is considering a London IPO with a valuation of £2 billion ($2.5 billion). The company plans to list in the UK capital next year and has initiated discussions with banks to select underwriters for the offering. Co-founder Juan Lobato expresses "big ambitions" for the company and is exploring IPO options. Ebury reported £204 million in revenue and £16 million in EBITDA for the year through April 2023. The IPO market is recovering, encouraging new share issuance amid a competitive banking sector. Santander acquired a majority stake in Ebury in 2019 and integrated it into its PagoNxt platform. (Source)

Dubai's Parkin Co. PJSC IPO Quickly Sells Out, Aims to Raise $429 Million

Parkin Co. PJSC, a Dubai-based public parking company, has quickly sold out its IPO, aiming to raise $429 million. The Dubai Investment Fund is selling a 25% stake, equivalent to 749.7 million shares, with prices ranging between 2-2.10 dirhams, valuing Parkin at up to $1.7 billion. The subscription period ends on March 12 for retail investors and March 13 for fund managers, with trading set to begin on March 21. The IPO is part of Dubai's plan to list 10 state-owned companies to boost market volumes. The Gulf region is experiencing an IPO boom driven by government listings and high oil prices. Parkin anticipates a 60% growth in public parking demand by 2033 and plans a 100% dividend payout for 2024. The share listing date is pending the completion of regulatory approvals. (Source)

Air Baltic Reports First Annual Profit Since 2018 Ahead of IPO

Latvian airline Air Baltic has reported its first annual profit since 2018, netting €33.7 million ($36.6 million) as it prepares for an IPO. The company plans to refinance a €200 million bond and raise an additional €100 million in debt markets. Air Baltic has engaged advisers for the IPO and aims to make an announcement in the second half of 2024. The airline is considering listing on the Nasdaq Riga, with the potential for a secondary listing in London or Amsterdam. Interest rates for Air Baltic's debt have risen following Russia's invasion of Ukraine, and the company may seek financing from the Latvian government if market funds are unobtainable. Air Baltic's fleet of Airbus A220 aircraft has been affected by Pratt & Whitney engine issues, impacting performance. (Source)

Indian Electric-Scooter Maker Ather Energy Selects Banks for Mumbai IPO

Ather Energy, an Indian electric-scooter manufacturer, has selected HSBC, Nomura, and JPMorgan to manage its upcoming IPO in Mumbai. The IPO is potentially scheduled for the second half of this year, with the company aiming for a $2 billion valuation. JM Financial and Axis Bank have also been chosen to assist with the offering. Ather is considering raising up to $400 million, although final details are subject to change. Founded in 2013 by Tarun Mehta and Swapnil Jain, Ather raised $128 million in a Series E funding round in 2022. The company's investors include the National Investment and Infrastructure Fund, Hero MotoCorp, and Tiger Global Management. (Source)

Reddit Faces Backlash from WallStreetBets Users Against IPO

IPOX® Analyst Lukas Muehlbauer chimes in on Reddit's IPO on Bloomberg, as the social media platform is facing criticism from users of its popular WallStreetBets forum regarding its upcoming IPO. Users are expressing concerns about Reddit's lack of profitability and the potential for increased moderation following the public offering. Reddit is seeking a valuation of up to $6.5 billion, with the IPO possibly taking place this month. WallStreetBets has notably influenced the performance of meme stocks like GameStop, but skepticism remains high for Reddit's own IPO. The negative sentiment revolves around issues such as volunteer moderation and the company's artificial intelligence ambitions. Reddit has acknowledged the risk of becoming a meme stock itself and has warned investors accordingly. Comparisons have been drawn to the performance of Robinhood's 2021 IPO amid the meme stock craze. (Source)