// Poundland parent company Pepco sets its price in the upcoming Polish IPO
// It has set the price of shares in the flotation at £7.60 a piece
// The IPO cuts Pepco owner Steinhoff’s shareholding in Pepco to 78.9%
Poundland owner Pepco Group has set its price in the upcoming Polish IPO at a discount, valuing it at €5 billion (£4.3 billion).
South African parent company of Pepco, Steinhoff – which is still grappling with fallout from a 2017 accounting scandal – has set the price of shares in the flotation at 40 zlotys a piece (£7.60).
The IPO cuts Steinhoff’s shareholding in Pepco to 78.9 per cent, assuming full exercise of an over-allotment option of a maximum of 12 million shares.
It puts the offer at the lower end of the range of 38 zlotys (£7.17) and 46 zlotys (£8.68), guided by the group earlier this month.
Pepco will look to raise about €700 million from the sale of more than 80 million existing shares in the IPO, but has room to sell up to 92.5 million.
The company also sold a further 23 million shares to its lenders to raise additional funds of €200 million.
The free float will total 20.1 per cent on admission to public markets, which is expected to be on May 26.
Pepco first announced last month about its decision to list on the Warsaw Stock Exchange rather than in London given its exposure to the Polish market.
“We are proud to be joining the Warsaw Stock Exchange in what will be its biggest IPO to date in 2021 and to become one of the largest listed companies in Warsaw,” Pepco chief executive Andy Bond said.
“Our group operates in the attractive European discount retail sector, and with our three market-leading brands – Pepco, Dealz and Poundland – we are extremely well positioned to take advantage of the enormous growth opportunities in front of us.
“We are pleased to have received strong interest and support from a broad range of high-quality international and Polish investors, including substantial retail demand, who have all recognised the quality of our financial track record and the substantial, long-term store growth opportunity that we can readily finance through our internally generated cash-flow.”
Bond sold 847,436 Pepco shares in the IPO, making about €7.5 million. He retains more than 3.7 million shares, worth about €33 million at the IPO price.