Exclusive Networks IPO: What led to a dismal debut?

Highlights 

  • French tech firm Exclusive Networks shares fell over 1.5 per cent following its IPO yesterday.
  • Its IPO issue price was fixed at the lower end of its price range at EUR 20, which gave it an implied market valuation of EUR 1.8 billion.
  • The need for cybersecurity has risen since the pandemic began due to the rise in cybercrimes and fraud.

France-based cybersecurity technology company Exclusive Networks listed yesterday on the Euronext Paris exchange and started trading today.

However, the company’s shares dipped around 2 per cent in its first trading session from its listing price yesterday. Exclusive Networks’ shares were trading at EUR 19.66, down by 1.69 per cent today at 12:09 PM BST+1.

The stock opened at EUR 19.90 today, down from its initial public offering (IPO) reference price of EUR 20.

Exclusive Networks’ IPO highlights

The French global security company had set its IPO listing price at the lower range of EUR 20, which implied the firm would have a market value of around EUR 1.8 billion.

The public offering was at EUR 366 million and include a 15 per cent over allotment of shares, which if and when exercised, will bring the total proceeds to about EUR 480 million.

Exclusive Networks IPO

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The company will be using the capital raised from float to expand its business overseas and also to drive growth via mergers and acquisitions.

The company reported a profit of EUR 180 million and sales of EUR 2.9 billion in FY 2020.

Bottom Line

Exclusive Network’s IPO comes at a time when cybersecurity has garnered attention not only in the EU and UK but across the globe.

Cybersecurity has risen exponentially in the past almost two years since the onset of the pandemic as working from home boosted the requirement for security and protection from cybercrimes.

Moreover, the UK and the EU have seen a huge boom in IPO listing, reaching multi year highs in terms of capital raised.

According to a recent report by the UK’s cybercrime police unit, National Fraud Intelligence Bureau, the UK has lost up to £1.3 billion in fraud and cybercrime so far in H1 2021, rising by over 3 times from £414.7 million in H1 2020.

The Bureau also found reported cybercrime had increased by 7 times to 289,437 reported cases in h1 2021, from 39,160 reported cases in H1 2020.

Recently Darktrace, a London based cybersecurity company, also went public on the London Stock Exchange.

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