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Pandora has expanded its current collection by adding composable earrings and watches.
Pandora has expanded its current collection by adding composable earrings and watches.

Pandora’s shares rocket

After a carefully planned stock market listing, Pandora’s shares rocketed on their first day of trading.
The Danish jewellery brand was officially valued at more than $5 billion after a partial listing on the Danish stock exchange saw shares soar by 25 per cent.

Danish private equity firm Axcel acquired a 60 per cent majority stake in Pandora in March 2008 and its intentions to prepare an initial public offering (IPO) of the company, worth up to DKK11.5bn ($2.21 billion), have been rumoured since early this year.

Shares in the company were fixed at DKK210 ($40) each – the higher end of expectations – giving it a market capitalisation of DKK27.3bn ($5.1bn). 2.8 million new shares were issued, raising net proceeds of DKK560m ($10 million), along with a sale of 44.5 million existing shares by Prometheus Invest ApS.

It was the biggest Danish IPO since the government sold a stake in phone company TDC A/S in 1994, fetching US$3 billion ($3.11 billion), and the second largest in Western Europe so far this year, according to Bloomberg.

Approximately 5,000 investors bought stock in Pandora, 5 per cent of whom were Danish individual investors and the rest Danish and international institutions, the company said.

International finance media reported that, “Traders were undaunted by Pandora’s meteoric rise on the back of the ongoing charm bracelet trend that drove global revenue to over £400m in 2009.

“Instead, they rewarded a model that sees it employ the majority of its 4,500 staff in cost-effective manufacturing facilities in Thailand while sales of jewellery priced between £100 and £1,000 are flourishing in the United States and Europe.”

While Australia and New Zealand knows full well about the power of the Pandora name, Financial Times analysts noted, “Pandora is heavily reliant on the continuing growth of charm bracelets, which accounted for 86 per cent of sales in the first half of this year.”

However other media reports noted that the success of Pandora jewellery to date has been limited to a number of countries and indeed, Pandora is just beginning to be launched in major markets.

One media report noted, “Another banker who worked on the deal also pointed to the company's growth prospects as an attraction for investors, particularly in countries Pandora hasn't tapped yet, such as Russia, China and Japan.

“He said some investors raised concerns about the rising cost of precious metals and the possibility that the charm bracelets' popularity could wane, but that the company's management did a good job of reassuring investors on its operating margins and the sustainability of demand for its products.”

The company has invested heavily in diversifying its portfolio over the past 12 months, including the launch of a watch collection last month.

Karin Adcock, managing director of Pandora Australia, was unavailable for comment.

More reading:
Pandora IPO to raise $112M
Pandora to launch IPO
Pandora to launch limited-edition charity range

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Your Say

Pandora Charms ?
No surprise, a lot of effort being put into new ranges, looks like they will continue to grow
posted by Jamie Mcgrath on November 03, 2010 02:33

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