Danish Tech Firm Netcompany Soars 25% on First Day of Trading

(Bloomberg) -- A Danish tech company that went public on Thursday quickly soared far above the price that initial investors agreed to pay for the stock.

Netcompany A/S, which says it wants to be a key player in helping northern Europe go digital, sold shares in an initial public offering for 155 kroner a piece, according to a pre-market announcement. When trading started, the Copenhagen-based firm shot up 25 percent, leaving it with a market value of more than $1.5 billion.

It’s a “very impressive start,” said Per Hansen, an investment economist at Nordnet AB. He says Netcompany “seems to be able to have its cake and eat it, too, in the sense that it has both high growth rates and high profitability.”

Danish Tech Firm Netcompany Soars 25% on First Day of Trading

It was Denmark’s biggest IPO since digital payments firm Nets A/S listed on Sept. 23, 2016. It was also the best first-day performance of a company starting on the Copenhagen stock exchange since Novo Nordisk A/S spinoff NNIT A/S went public on March 6, 2015. (NNIT rose as much as 46 percent before ending its first day 26 percent higher.)

Netcompany shares were sold by various funds under FSN Capital as well as key employees, including co-founder and Chief Executive Officer Andre Rogaczewski.

The target price had initially been set as low as 135 kroner, with 165 kroner seen as the upper end of the range. Danske Bank A/S, Deutsche Bank AG, and Morgan Stanley & Co. International plc acted as joint global coordinators and joint bookrunners. SEB AB was joint bookrunner.

“Danish IPOs have had mixed success recently but that hasn’t had any negative effect on Netcompany,’’ Hansen said by phone. “Investors have looked at Netcompany and seen a unique case and have not been affected by somewhat meager returns on recent IPOs in Denmark.”

Nets went public at 150 kroner a share, but fell in subsequent months to around 110 kroner until takeover speculation boosted its price again. The payments company has since been bought out by U.S. private equity firm Hellman & Friedman.

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