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GFG - Global Fashion SA News Story

€5.84 0.2  3.0%

Last Trade - 11:04am

Sector
Consumer Cyclicals
Size
Mid Cap
Market Cap £903.4m
Enterprise Value £746.6m
Revenue £1.21bn
Position in Universe 372nd / 1038

Global Fashion Group IPO mostly backed by existing shareholders

Sat 29th June, 2019 10:59am
FRANKFURT, June 29 (Reuters) - Global Fashion Group (GFG)
 GFG.DE  raised less than half the sum it had originally
targeted in an initial public offering of new shares that drew
weak investor demand and ended up being mostly backed by its
existing shareholders.
    GFG said it placed 40 million new shares at a price of 4.50
euros, raising 180 million euros ($205 million). 
    Swedish investor Kinnevik  KINVb.ST , which owns 36.8% in
GFG, and Germany's Rocket Internet RKET.DE , with 20.4%, bought
shares worth 60 million euros and 50 million euros respectively.
    A further 4 million existing shares were allocated to cover
an over-allotment option for banks running the deal. If taken
up, proceeds would rise to 198 million euros, GFG said in a
statement.
    Capital market conditions had weighed on investor sentiment
towards the deal, with truck maker Traton  8TRA.DE  and telecom
firm Africa Airtel  AAF.L  both slipping in their stock market
debuts on Friday.  urn:newsml:reuters.com:*:nL8N23Z24N  urn:newsml:reuters.com:*:nL8N23Z1HT
    In a last-ditch effort to salvage the stock market listing,
GFG cut the price of its offering on Wednesday to 4.50 euros a
share, from an initial price range of 6 to 8 euros.  urn:newsml:reuters.com:*:nL8N23W48Y
 
    GFG had extended the offer period to June 28 and sources
told Reuters that cancelling the listing had also been
discussed.  urn:newsml:reuters.com:*:nL8N23W48Y
    The sources said investors had expressed scepticism about
investing in the company, which focuses on emerging markets in
Latin America and Asia, and operates The Iconic, Zalora, Dafiti
and Lamoda platforms.
    Investors have been shying away from buying assets backed by
Rocket, which is known as a fast follower of successful internet
companies rather than as an innovator. Most have lost value
after listing, one person familiar with the GFG deal said.
    GFG shares are due to start trading in Frankfurt on July 2.
    
    ($1 = 0.8797 euros)

 (Reporting by Arno Schuetze and Douglas Busvine
Editing by Edmund Blair)
 ((arno.schuetze@thomsonreuters.com; +49.69.7565.1197; Reuters
Messaging: arno.schuetze.reuters.com@reuters.net))
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