MARKET REPORT: Dr Martens arrives on the stock market in style as the boot maker is valued at nearly £4bn
Dr Martens arrived on the stock market in style yesterday as the boot maker was valued at nearly £4billion.
The company kicked off its London float by pricing its shares at 370p each, the top of previous estimates, and was met with huge demand from investors.
It will raise £1billion and implies a market capitalisation of £3.7billion – not a bad day’s work for owner Permira, which bought the business for £300m seven years ago.
So eager were investors that brokers received orders for nine times the amount of stock available, Dr Martens said.
It meant the shares – given the ticker ‘DOCS’ – jumped 21.6 per cent during frenzied conditional trading, closing at 450p.
Chief executive Kenny Wilson said he was ‘delighted’ by the response so far.
‘The successful transformation of Dr Martens is a great story, and what is even more exciting is the huge potential ahead,’ he added.
‘We are proud to take our place as a London listed company.’ Dr Martens, known for its chunky boots with yellow stitching, is the first of several British floats expected to hit the market this year after the Covid-19 pandemic wreaked havoc on global stock markets.
Ecard retailer Moonpig is expected to follow it soon, while others such as Deliveroo and Darktrace are also plotting their debuts. Yesterday Moonpig said it would price its own offering at the top end of its 310-350p per share range, valuing the company at about £1.2billion.
It is also speeding up the process and expanding how many shares will be sold, meaning the amount of money being raised could increase from £422m to £549m. Conditional dealings are expected to begin on Tuesday.
But it was another bad day for the FTSE 100 as the blue-chip index finished deep in the red.
The Footsie fell 1.8 per cent, or 118.69 points, to finish at 6407.46, putting losses since last week at 4.3 per cent.
Analysts blamed the malaise on fears of another flood of activity from retail investors, who have been piling into stocks targeted by short sellers using trading apps.
David Madden, an analyst at CMC Markets, said: ‘Fear is running through the equity markets again as some trading apps have relaxed restrictions on certain stocks that have experienced colossal volatility recently, like Gamestop.
That could renew fears that some hedge funds might adopt a cut and run policy, hence why equity markets are lower across the board.’
Among the top blue-chip fallers were Rolls-Royce, which fell 5.4 per cent or 5.24p to 91.7p, and Prudential, which slipped a further 5.1 per cent or 63.5p to 1172.5p as investors digested its plans to raise cash by issuing shares. But food delivery firm Just Eat gained 4.1 per cent, or 322p, to finish at 8372p, while Pearson, which has benefited from small shareholder interest, rose 1.6 per cent, or 12.6p, to 812.6p.
The FTSE250 index of mid-sized companies didn’t fare much better than its blue chip sibling, falling 0.7 per cent, or 139.67 points, to 20,228.58.
One company investors couldn’t make up their minds about was engineer and defence contractor Avon Rubber, with its shares closing flat at 3100p after see-sawing throughout the day.
The engineer and defence contractor last month revealed shock delays to two contracts with the US Department of Defence, while a rival was trying to contest its award of another.
Yesterday though the company said it was trading as expected and was making good progress with updates to body armour that it is doing for the Pentagon.