Por Abhinav Ramnarayan y Julien Ponthus

LONDON, March 30 (Reuters) – Deliveroo shares plunged as much as 30% on its trading debut on Wednesday, slashing the company’s valuation by more than £ 2 billion, in a blow to the food and beverage delivery group. for the London IPO market.

The long-awaited stock market premiere, the biggest on the London market in a decade, had been hailed by UK Chancellor Rishi Sunak as a “true British technology success story” that could pave the way for more IPOs. of fast-growing tech companies.

Deliveroo drops 30% in painful IPO

Reuters

See more videos

What to watch next

  • The US prepares new sanctions against Chinese authorities for the repression in Hong Kong

    The US prepares new sanctions against Chinese authorities for the repression in Hong Kong

    Reuters Logo

    Reuters

  • Iran vows to retaliate for the assassination of its top nuclear scientist

    Iran vows to retaliate for the assassination of its top nuclear scientist

    Reuters Logo

    Reuters

  • Stocks, oil rise on Biden transition and vaccine hopes

    Stocks, oil rise on Biden transition and vaccine hopes

    Reuters Logo

    Reuters

  • Roblox Submits its Accounts to Go Public and Shows a 68% Increase in Revenue

    Roblox Submits its Accounts to Go Public and Shows a 68% Increase in Revenue

    Reuters Logo

    Reuters

  • Amazon launches an online pharmacy in a new challenge to retailers

    Amazon launches an online pharmacy in a new challenge to retailers

    Reuters Logo

    Reuters

  • Pfizer will begin a pilot program to distribute its COVID-19 vaccine in 4 US states

    Pfizer will begin a pilot program to distribute its COVID-19 vaccine in 4 US states

    Reuters Logo

    Reuters

  • European stocks extend rally on vaccine expectations and ECB comments

    European stocks extend rally on vaccine expectations and ECB comments

    Reuters Logo

    Reuters

  • AstraZeneca resumes its trial in the US and J&J will do the same next week

    AstraZeneca resumes its trial in the US and J&J will do the same next week

    Reuters Logo

    Reuters

  • Lee Kun-hee, who turned Samsung into a global giant, dies at 78

    Lee Kun-hee, who turned Samsung into a global giant, dies at 78

    Reuters Logo

    Reuters

  • South Korean SK Hynix buys Intel's NAND card business for $ 9 billion

    South Korean SK Hynix buys Intel’s NAND card business for $ 9 billion

    Reuters Logo

    Reuters


  • The US prepares new sanctions against Chinese authorities for the repression in Hong KongThe US prepares new sanctions against Chinese authorities for the repression in Hong Kong
    Reuters sources say up to 14 people in mainland China and Hong Kong will be targeted with asset freezes and financial sanctions. The measures are in response to last month’s suspension of opposition lawmakers in Hong Kong’s parliament. Flora Bradley-Watson reports.

    Reuters LogoReuters

  • Iran vows to retaliate for the assassination of its top nuclear scientistIran vows to retaliate for the assassination of its top nuclear scientist
    An Iranian scientist long suspected by the West of masterminding a secret nuclear bomb program was killed in an ambush near Tehran on Friday that could provoke confrontation between Iran and its foes in the last weeks of Donald Trump’s presidency. Lisa Bernhard produced this report.

    Reuters LogoReuters

  • Stocks, oil rise on Biden transition and vaccine hopesStocks, oil rise on Biden transition and vaccine hopes
    European shares jumped on Monday as encouraging developments around a coronavirus vaccine spurred bets of a faster economic revival globally, even as a surge in infection rates clouded near-term outlook. Ciara Lee reports

    Reuters LogoReuters

FOLLOWING

However, the debut had already been overshadowed by the fact that some of the largest British investment firms refused to participate in the operation, citing concerns about working conditions in the gig or bowling economy and the structure of the actions.

The 390 pence price gave an overall valuation of 7.6 billion pounds ($ 10.46 billion) and was already at the bottom of an initially proposed guideline range.

Within minutes of opening the market on Wednesday, it was losing 2.28 billion pounds in value. This development will hurt the IPO market in the UK and Europe, according to a capital markets expert banker.

“It is an extremely painful move in one of the most anticipated IPOs of the year,” he said, asking to remain anonymous.

After hitting a low of 271 pence, the stock rose again to 298 pence at 1015 BST.

Stocks tend to rebound from steep declines on their market debut when managing banks make use of the over-allotment option or “greenshoe”, a percentage of the supply set aside to stabilize the price.

One trader said it had not seen any buyers for the shares. “All we have seen is one way traffic, not a single buyer,” he told Reuters on condition of anonymity.

A source familiar with the deal said it was a difficult start, but that the company would have to focus on the long term.

“Deliveroo has today raised 1 billion new capital that is going to invest in the business and in new technologies. It is not about the price of the share in a single day.”

(Information from Abhinav Ramnarayan and Julien Ponthus; additional information from Elizabeth Howcroft and Tom Arnold, edited by Rachel Armstrong and Barbara Lewis, translated by Tomás Cobos)

Read more