A $6.8 billion price tag has been placed on the head of online fashion retailer Zalando in the ramp up to its initial public offering.
An estimated value has been calculated on the basis of shares trading at $27.28 when the Frankfurt stock exchange opens its doors to Zalando on Wednesday, October 1.
The Berlin company had expected shares to trade at a slightly lower total of $22.86 but saw reason to up its target after witnessing strong investor demand.
Analysts believe Zalando is capable of raising a minimum of $668 million which, if realised, could represent the biggest IPO from a German tech firm since Deutsche Telekom’s float in 2000.
Traders enthuse
Representatives from Zalando announced plans for an IPO in early September with the aim of raising funds from around 10% of its capital.
In one of very few news releases surrounding the event, Zalando executive Rubin Ritter appeared surprised about the overwhelming amount of support from trading experts.
“The feedback we received from investors and employees was great. The significant investor demand, which substantially exceeded the amount of shares offered, reflects confidence and high interest and our long-term growth opportunity.”
Reports suggest the total stake being traded will amount to just over 11% as the company looks to pounce on advantageous conditions.
Ecommerce titan
Despite only being six years old, Zalando currently stands as one of the biggest online retailers in Europe. The company has reach across key shopping markets such as the UK, France, Netherlands, Italy, Spain, Poland and Germany among others.
Some of the firm’s larger shareholders include investment companies such as Kinnevik, Global Founders Capital and DST Europe as well as individuals such as Danish businessman Andres Holch Povlsen.
These parties will now be set to join forces with new investors in what Zalando board member Rubin Ritter described as “the next logical step in Zalando’s evolution”.