Pepco Group, the discount retailer known for its popular chains including Pep&Co, is preparing for an initial public offering (IPO) on the Warsaw Stock Exchange. The parent company, Steinhoff International Holdings, hopes to raise £870 million through the IPO by selling up to 17.5% of Pepco Group’s shares, valuing the company at nearly £5 billion. The IPO will also allow Steinhoff and other major shareholders to sell 101.3 million existing shares. Trading of the stock is expected to commence around 26th May.

The decision to sell or list Pepco Group has been in the works for over a year as Steinhoff aims to generate funds to repay debt. Although Pepco Group will not directly receive any proceeds from the IPO, it has secured €550 million (£475 million) in new term loans and a €190 million revolving credit facility from lenders to support its expansion plans. The pandemic-induced global economic downturn has led to an increase in demand for discounted products, thus benefiting Pepco Group. With over 3,200 stores present in 16 markets, including popular outlets like Poundland in the UK and Dealz in Ireland, Spain, and Poland, Pepco Group has capitalized on the growing popularity of discount shopping. The company has also recently expanded into the Italian market as part of its strategy to penetrate more western European markets.

The IPO is a significant milestone for Pepco Group, emphasizing its ambitious growth plans and strong market position. Its presence in both eastern and western European markets positions it well to capitalize on the rising trend of discount shopping. The funds raised from the IPO and the new financing arrangements will provide Pepco Group with the necessary resources to fuel its expansion and further reinforce its standing in the market. Investors will closely monitor the pricing and performance of Pepco Group’s stock following its listing on the Warsaw Stock Exchange.

Sources:
1. <a href=”https://www.bloomberg.com/news/articles/2021-05-05/pep-co-parent-steinhoff-seeks-5-1-billion-in-pepco-ipo” target=”_blank”>Bloomberg</a>
2. <a href=”https://www.reuters.com/business/retail-consumer/dealz-owner-pepco-aims-raise-over-1-bln-euros-ipo-2021-05-05/” target=”_blank”>Reuters</a>