June 25, 2019 / 1:59 PM / 8 months ago

Global Fashion Group postpones initial public offering

FRANKFURT (Reuters) - Global Fashion Group (GFG), an online fashion retailer focused on Asia and Latin America, is postponing its initial public offering until July, which sources close to the matter said was due to low investor demand.

GFG said on Tuesday that the offer period for the IPO, which had been scheduled to end on Tuesday, would be extended to June 28. The offer period is when potential investors put in bids for the shares being sold in an IPO.

The company’s shares, which had been expected to start trading on Thursday in Frankfurt, will now start trading on July 2, GFG said.

A source close to the matter said more time was needed to talk to investors and that GFG’s IPO process had been affected by negative sentiment following the recent poor performance of several Nasdaq-listed technology stocks.

Cancelling the IPO altogether had also been discussed, people close to the matter said.

The sources also said that investors had expressed scepticism about investing in the company which operates The Iconic, Zalora, Dafiti and Lamoda platforms. They added that banks working on the deal had not yet received demand covering all shares on offer.

GFG did not give reasons for the changes to the timing of the IPO.

GFG offered new shares worth 296 million euros to 395 million euros (264.38 million pounds-352.80 million pounds) - including an overallotment option with an implied market cap of 1.24-1.66 million euros.

Swedish investor Kinnevik currently owns 36.8% in the company, while German start-up incubator Rocket Internet owns 20.4%.

(This story corrects in third paragraph, corrects first day of trading to July 2, not July 4).

Reporting by Arno Schuetze; Editing by Riham Alkousaa/Michelle Martin/Jane Merriman

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