This post was originally published on this site
STOCKHOLM (Reuters) – Automaker Volvo Cars’ shares rose 13% above their offering price in its trading debut in Stockholm on Friday, after completion of Europe’s biggest initial public offering (IPO) so far this year.
The Gothenburg-based company cut the size of its listing and priced it at the bottom of a previously-announced range on Monday, valuing it at just over $18 billion.
The successful deal and aftermarket performance is a boost to a European automotive industry that is making a challenging transition towards electric vehicles.
It also shows that while the IPO euphoria of the first half of 2021 is over, the market is open for new listings of sizeable companies with a story to tell.
Volvo Cars Chief Executive Håkan Samuelsson said the listing symbolised a recognition of its transformation plans, in the rapidly changing car sector.
“It’s a very exciting journey and now we have the money for it,” he told journalists and investors in a webcast opening ceremony on Friday.
Shares in the carmaker, which is majority owned by Geely Holding, were trading at 59.95 Swedish crowns ($7.03) at 0745 GMT, after being priced at 53 crowns in the initial public offering (IPO).
Investor appetite for the electric vehicle (EV) sector is strong.
However, concerns over how much control Geely will retain over Volvo, problems in the global supply chain and worries car makers could be caught in trade wars involving China have curbed investor enthusiasm.
Geely chairman Eric Li said that when Geely acquired Volvo, its goal had been to send “the tiger back to the mountains”.
“Now our goal is to give that tiger wings and let it soar,” he said in a pre-recorded video.
($1 = 8.5219 Swedish crowns)
