By Julien Ponthus and Abhinav Ramnarayan
LONDON -Private equity firm Bridgepoint saw its value rise by more than a fifth on its London stock market debut on Wednesday, reflecting investor hunger for the sector at a time when several other buyout firms are said to be considering listings.
Bridgepoint shares opened at 423 pence on the first day of trading in London, up 21% from the 350 pence per share price set for the initial public offering (IPO). By 1100 GMT they had risen further to 437 pence, up 24.1%.
The 350 pence-per-share price tag gave the group an initial market capitalisation of 2.88 billion pounds ($3.92 billion).
Bridgepoint’s debut as a public company comes at a time when private equity groups, flush with cash after largely sitting out the pandemic, have embarked on a spending spree, with Britain a favoured target for acquisitions.
Banking sources have indicated that a number of other private equity firms are considering IPOs in the second half of 2021, with European infrastructure investor Antin reportedly considering a Paris listing.
“Private equity offers exposure to a non-correlated asset class – one which does not move slavishly in line with stock or bond markets – and therefore provides useful diversification across a balanced portfolio,” analysts at AJ Bell said in a note.
Bridgepoint, which focuses on mid-sized deals of up to one billion euros ($1.2 billion), manages 27.4 billion euros across a range of private equity and debt funds and was formed in 2000 after a management buyout of NatWest’s private equity arm.
Its investments include Asia-inspired dining chain Itsu, cycle retailer Wiggle and Burger King’s France and UK outposts.
The company sold 85.7 million new shares to raise roughly 300 million pounds, with which it plans to fund investment, assess potential acquisitions and reduce debt.
Existing shareholders sold an additional 139.7 million existing shares, bringing the initial offer size to 789 million pounds. That sets the freefloat at roughly 27% but it will rise to around 31.5% if an over-allotment option is exercised in full.
JP Morgan and Morgan Stanley were joint global co-ordinators on the deal.