FRANKFURT, May 19 (Reuters) - Shares in enterprise software company SUSE held their own in a Frankfurt stock market debut on Wednesday, climbing just above their 30 euro issue price, giving the group a market cap of around 5 billion euros ($6.1 billion).
Nuremberg-based SUSE had priced the deal towards the lower end of a 29 to 34 euros per share range with a view to securing a solid aftermarket performance, after volatile markets derailed a number of other European flotations.
CEO Melissa di Donato, the first woman to lead a high-profile initial public offering in Frankfurt, rang the opening bell in a video message showing images of cheering team members projected on to a screen behind her.
“This is the start of an incredible journey,” said the American veteran of SAP, who was hired by private equity investor EQT two years ago and has her sights set on sustaining double-digit growth.
SUSE provides open-source software for companies to run applications at cloud datacenters, on-premise servers, mainframe computers and devices at the edges of networks, making it a play on digital transformation.
The company, founded three decades ago, runs on the Linux open source standard and counts 60% of the U.S. Fortune 500 companies among its customers.
The IPO adds to a busy Frankfurt season, following the $10 billion listing by German used-car trading platform AUTO1 , a $14 billion debut by Vodafone’s Vantage Towers and the $5 billion IPO of labs group Synlab.
While these deals have proved good bets for investors, other European tech listings, such as Deliveroo and Alphawave have disappointed.
Sentiment has also been dampened by Trustly’s and Meinauto’s cancellations of their IPO plans earlier this month.
“All of this has had a major impact on investors’ risk appetite and their ability to put money into new tech transactions,” said one equity capital markets banker.
Companies have to choose between putting off IPO plans and risk a potential repricing of the technology sector as investors’ inflation worries return, or move more quickly and take a chance on investors’ mood.
In the SUSE transaction, Europe’s largest software IPO of the year, a total of 37.8 million shares were sold for 1.1 billion euros.
The company is issuing new shares to help pay down debt, while owner EQT is also selling down its stake.
EQT will remain the company’s largest shareholder with a stake of 77.6%. It acquired SUSE in 2018 for $2.5 billion and stands to double its money via the IPO.
($1 = 0.8173 euros)
($1 = 0.8174 euros)
(Reporting by Arno Schuetze Editing by Riham Alkousaa and Jane Merriman)