Polish ecommerce platform Allegro prepares country’s largest IPO


Poland’s biggest ecommerce platform, Allegro, said on Monday that it planned to list on the Warsaw Stock Exchange in what could become the central European country’s largest initial public offering.

Advisers to Allegro, which is owned by private equity groups Permira, Cinven and Mid Europa Partners, are targeting a valuation of between €10bn and €12bn, according to people close to the deal. If this is reached, Allegro would become Poland’s biggest listed company.

According to intention-to-float documents published on Monday, the listing is set to include a sale of new shares worth around 1bn zlotys, as well as a “secondary component” in which the private equity groups and some company directors and managers will sell down some of their existing stakes.

The exact size of the offering has yet to be determined, but people close to the deal said that the listing would probably be 20 per cent to 25 per cent of the company. Poland’s biggest IPO to date came in 2010, when insurer PZU raised €2.1bn.

The flotation is expected to take place in October and, if successful, would be a shot in the arm for Warsaw’s stock exchange, which is dominated by state-controlled companies and has struggled to attract listings in recent years.

Allegro said that the transaction would enable it to repay part of its debt. At the end of June, its net debt was 3.7 times the company’s adjusted earnings before interest, tax, depreciation and amortisation.

Allegro, which competes with the likes of Amazon, is also considering expanding the proportion of its goods that are delivered within one or two days of being ordered, and increasing its fintech activities.

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Cinven, Permira and Mid Europa Partners bought Allegro from South African group Naspers in 2016, in a $3.25bn bet on Poland’s growing middle class and expanding online retail market.

The central European country’s economy has grown rapidly in recent years, and until the coronavirus pandemic hit, was on a recession-free streak dating back to 1992, a record bettered only by Australia.

Yet although Poland’s middle class has expanded quickly over the past decade and the country is a leader in digital payments, only 8 per cent of its total retail market is online, which Allegro believes gives it scope for further growth. In the UK, by contrast, 18 per cent of retail sales are online.

Allegro was founded in 1999, has around 12.3m “active buyers” and is used by around 117,000 merchants. Both wholesalers and members of the public can sell via the site.

In 2019, the company made a net profit of 399m zlotys, up 73 per cent from a year earlier. Revenues were 2.39bn zlotys, up 31 per cent on 2018.



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