Trustpilot Surges in Debut as London IPO Raises $655 Million

(Bloomberg) -- Danish consumer-review site Trustpilot Group Plc jumped as shares started trading in London after its initial public offering raised 473 million pounds ($655 million), helping the City solidify its position as an attractive venue for continental companies after Brexit.

The stock traded at 295 pence as of 8:13 a.m. in London, up 11% from the initial public offering price of 265 pence a share. This was the top end of an indicative price range. The IPO of the 44% stake gives the company a market value of 1.08 billion pounds, according to a statement Tuesday

With the sale, companies now have raised 5.2 billion pounds via IPOs in the U.K. this year, bringing the market closer to a record first-quarter showing, data compiled by Bloomberg show. Food delivery startup Deliveroo Holdings Plc is also set to start trading in London before the month is up. Both deals have been boosted by surging demand for online services during lockdowns.

The City’s IPO renaissance comes amid broad efforts to strengthen its position after leaving the European Union last year, with the U.K. considering proposed reforms to the listing rules to attract more high-growth companies. Trustpilot is the first issuer from the bloc to list in London after Brexit.

Trustpilot’s backers raised almost 427 million pounds by selling 161 million existing shares in the IPO, while the company itself raised about 47 million pounds. The offering could raise as much as 544 million pounds if an option to sell additional shares from existing investors is exercised in full.

Investment firms including BlackRock Inc., FIL Investments International, Caledonia Investments Plc, Capital Research Global Investors, Adelphi Capital and Janus Henderson Group Plc agreed to buy a big chunk of the offering before Trustpilot began the sale.

Trustpilot saw strong investor demand for its offering, with the IPO order book covered within about 1.5 hours after it was opened last week, according to terms seen by Bloomberg. The company also raised the total size of the offering by as much as 15 million shares on Friday.

Trustpilot had hosted 120 million reviews by the end of 2020. It makes money by selling subscriptions to businesses, which can use consumer reviews in their marketing materials and directly engage with customers on the platform. Its revenue jumped 25% last year to $101.9 million, and its loss narrowed to $12.2 million from $22.7 million in 2019.

Chief Executive Officer Peter Holten Muhlmann founded the company in 2007, and its shareholders include Seed Capital, Vitruvian Partners, Draper Esprit, Northzone, Index Ventures and Sunley House.

Morgan Stanley and JPMorgan Chase & Co. are managing the offering, along with Berenberg and Danske Bank A/S.

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