UPDATE 1-AUTO1 shares rally 45% in Frankfurt debut

(Adds investor comment, context)

BERLIN, Feb 4 (Reuters) – Shares in used-car trading platform AUTO1 raced ahead in their stock exchange debut on Thursday, as Germany’s first big initial public offering of the year was buoyed by investors’ insatiable appetite for tech stocks.

The shares opened in Frankfurt at 55 euros a share – 45% above the price at which they were sold to investors in an oversubscribed offering that valued the nine-year-old Berlin startup at 7.9 billion euros ($9.47 billion).

AUTO1 priced its 1.8 billion euro initial public offering (IPO) at the top of a 32 to 38 euros per share range, following strong demand from investors in Europe’s second big tech IPO of the year.

AUTO1 is the top platform for buying and selling in Europe’s 600-billion-euro market for used cars and will reap 1 billion euros from the offering of new shares, most of which will be ploughed into building its Autohero retail brand.

Existing backer Softbank’s Vision Fund, which owned a 20% stake, will turn a big profit by selling shares, having backed AUTO1 in early 2018 at a valuation of 2.9 billion euros.

DN Capital, which first backed AUTO1 in 2013, hailed the flotation as the result of co-founders Christian Bertermann and Hakan Koc’s “brilliant execution and clear-sightedness” in building a business than now spans 30 countries.

New investors, including U.S. venture fund Sequoia and hedge fund Lone Pine were so-called ‘cornerstone’ investors in the IPO to the tune of 150 million euros each.

The Frankfurt listing cements its status as one of the two leading venues for tech stocks on the European continent. A recent Deutsche Boerse report said Frankfurt accounted for 26% of tech market capitalisation behind Euronext Amsterdam on 27%.

A swathe of companies is rushing to list on European stock exchanges and benefit from strong investor appetite for new issues that echoes sentiment in the red-hot U.S. IPO market.

Last week, $12 billion euro Polish parcel locker firm InPost jumped on its Euronext debut in Amsterdam, as did $5 billion boot brand Dr. Martens and $1.63 billion greeting card retailer Moonpig in London. ($1 = 0.8340 euros) (Reporting by Douglas Busvine Editing by Riham Alkousaa and Jane Merriman)

Margaret R. Servin

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