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The Warsaw Voice » Business » July 29, 2011
Business & Economy
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From Strenght to Strenght
July 29, 2011   
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Coal company Jastrzębska Spółka Węglowa (JSW), one of the largest producers of coke in the European Union, hit the Warsaw Stock Exchange (WSE) in July, marking a further step in the development of Poland’s capital market.

The company’s initial public offering (IPO) was worth nearly zl.5.4 billion and comprised a total of 39.5 million shares, or 33.1 percent of the company’s equity. The offering attracted over 168,000 retail investors, including almost 7,000 JSW employees. Retail investors snapped up more than 10 million shares, while institutional investors bought the remaining 29 million or so.

“Share ownership by private individuals has increased in Poland with this IPO,” said Treasury Minister Aleksander Grad. “Polish people want to be shareholders, they want to invest.”

According to WSE President Ludwik Sobolewski, the JSW offering was the second largest IPO in Europe this year.

According to the latest IPO Watch Europe report published by PricewaterhouseCoopers (PwC), in the first and second quarters of this year, the Warsaw Stock Exchange topped the list in Europe in terms of the number of IPOs on the regulated and alternative markets. In the second quarter, 55 new companies were listed on the WSE, 13 on the main market and 42 on the alternative market, in what was the best quarterly figure for the WSE ever.

In the second quarter, the WSE ranked third in Europe, after the London Stock Exchange and Deutsche Börse, in terms of the value of IPOs, according to PwC.

“The Warsaw Stock Exchange is a leading European market in terms of IPOs, and in the first half of the year it was also among the top 10 markets worldwide,” said the WSE’s Sobolewski. “Our international strategy is producing tangible results and I am convinced that more companies will notice the potential of the Polish capital market. The debuts by Polish and foreign companies planned in the near future and the July debut of JSW, one of the largest IPOs in Europe, make us believe that the Warsaw exchange will strengthen its leading position in Europe on the IPO market.”

From April to June the largest IPOs on the Warsaw trading floor were the 111-million-euro offering of financial services company Open Finance, the 104-million-euro debut of Slovenian bank Nova Kreditna Banka Maribor, and the 93-million-euro IPO of debt collection company Kruk. In the second quarter of the year, the WSE’s main market also welcomed four Ukrainian companies, milk producer Industrial Milk Company, agricultural market player KSG Agro, battery producer Westa Isic, and egg producer Ovostar Union. The total value of these four IPOs exceeded 100 million euros.

The second quarter also saw record activity on the NewConnect alternative market, with a total of 42 companies debuting, their IPOs worth a combined 38.4 million euros. The 7.4-million-euro offering of building company KPBP Budus was the largest.

NewConnect also welcomed UK-based investment company AerFinance in the second quarter. The IPO was worth 1.7 million euros.

“Considering the uncertainty on global markets, the second quarter and the second half of the year as a whole may be regarded as a good time for the WSE,” said Filip Gorczyca, a capital market expert at PwC. “Despite the fact that during the first six months of the year there was only one—partly successful—privatization deal, that of BGŻ, the WSE strengthened its position among top European exchanges. The growing number of foreign issuers helped fill the gap created by the absence of large IPOs by state-controlled companies—of the kind PZU and Tauron came up with last year. It is clear that the WSE’s efforts to attract as many issuers from Ukraine as possible, including the launch of the WIG-Ukraine index, have produced results. The fact that the WSE is being chosen as the best place to list their shares by companies from distant countries in the region such as Slovenia, is also a sign of Warsaw’s strength. Let us hope that this trend will persist and that foreign issuers of debt securities will gradually follow in the footsteps of foreign stock issuers.”

Jacek Socha, vice-president of PwC in Poland, said, “The WSE is beginning the third quarter on a strong note—with the debut of Jastrzębska Spółka Węglowa. This IPO is one of the largest IPOs in Europe this year, alongside those of Glencore and Vallares. This should strengthen the position of our exchange and support the inflow of new capital from abroad. Unless the investment climate on global markets deteriorates significantly, it may be expected that the number of Polish and foreign issuers eager to come to the WSE will be even higher in the second half of the year.”
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