In a year that started with a bang and ended with a whimper it was the IPO that managed to survive the turmoil and maintain strong growth that earns the accolade of IPO of the year. Allfunds, the Madrid-headquartered B2B wealth management platform, popped on its debut in April and kept up the pace for the rest of the year.
A superb start to the year in Europe meant that at times there was no shortage of deals that ticked all the boxes in the short term, but ultimately7 ended up delivering hefty losses from the IPO price.
While those companies cannot be held accountable for the turn in markets, the €2.2bn IPO of Allfunds has stood the test of time better than others.
It opted to list on Euronext Amsterdam and attracted wide interest from the start with around 50 investors involved in pilot-fishing stages.
Five cornerstones committed to invest €850m – led by a €250m cheque from BlackRock and €200m from Jupiter – representing half the base deal at the bottom of the range. One anchor order received when books opened was US$650m.
Books were covered inside an hour and covered at the top of the range on the second day. Any concerns that the accumulating losses from Deliveroo’s IPO at the end of March would hurt subsequent transactions – especially an all-secondary one like Allfunds – quickly dissipated.
Pricing came at €11.50 per share, within the €10.50–€12.00 range, despite double-digit subscription on a book of more than 250 lines.
Several IPOs until that point had met with apparently strong demand only to struggle on debut, leading to a focus on refining the allocations on this trade. The top 20 orders got 70% of the stock, while 30% of orders received nothing. Long-only investors were 48% of demand and 84% of allocations.
Allocations worked to a tee. Allfunds shares opened up 10% – representing a market cap of just under €8bn – and ended their first day up 20%. Volume that day was just 12% of offered shares.
When three shareholders broke the lock-up to sell shares in September there had already been reverse enquiry from institutions seeking stock. First-half results earlier in September showed strong growth while maintaining a high margin, with shares gaining over 15% in response.
Pricing of the accelerated bookbuilding was 39% above the IPO price. At their peak in October shares were up 60% from issue, six months on from the IPO. One banker involved called it the sleeper success of the year.
“It was a great IPO on the day, a month later, and nine months later,” said Andreas Bernstorff, head of ECM at BNP Paribas, which was a joint global coordinator with Citigroup, Credit Suisse and Morgan Stanley. Rothschild advised.
Its shares were hammered at the start of 2022 as markets turned dramatically. Allfunds fell 30% in just over three weeks. Yet the lowest print for Allfunds shares by the end of January was €11.67.
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