Photobox says cheese to £500m IPO

IPO WATCH: The Moonpig owner is the latest retailer reportedly jumping on the flotation bandwagon.

by Rachel Savage
Last Updated: 10 Mar 2014

Unlike buses, London IPOs keep on coming: first, there was AO.com (very successful). Then there was McColl's (less successful). The latest company rumoured to be preparing to float is online personalised gift and photo seller Photobox, parent company of greeting cards website Moonpig.

The online retailer has reportedly appointed JP Morgan, Jeffries and Numis to prepare it for a £400m-£500m summer IPO.

It’s good news for the London Stock Exchange, which has been struggling to attract high-growth tech companies. British-based Candy Crush-maker King filed for an IPO in New York last month and the LSE’s High-Growth Segment, launched last year, is so far empty (no word on whether Photobox wants to list there or on more established small company market AIM).

Photobox, which bought Moonpig for £120m in 2011, posted sales of £148m in the year to April 2013, a 13% rise from the previous 12 months. The company is part of the government and Tech City UK’s ‘Future Fifty’, a year-long programme which connects fast-growing businesses with support to grow. The scheme also ‘aims to boost visibility and exposure of the companies to institutional investors’ – looks like that’s working for Photobox.

The online retailer follows fashion website Boohoo.com, Poundland and Pets at Home in pursuing an IPO. Online home appliances seller AO.com has already taken the plunge successfully – its shares surged more than 40% when they listed two weeks ago.

A company is always fumbling in the dark to some extent when it goes public – convenience store chain McColl’s is still trading below its original price of 191p after its debut a couple of weeks ago.

Meanwhile, across the pond, music streaming service Spotify is rumoured to be shaping up for a multi-billion dollar IPO after securing a $200m credit facility from investment banks including Goldman Sachs and Morgan Stanley, according to the FT.

The loss-making Swedish start-up will want to emulate fellow tech company Twitter, whose shares have risen 19% since they floated in November. Like Twitter, it might also want to think about making money too...

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