We Soda, the world’s largest producer of natural soda ash used to make glass, has today confirmed plans to list 10% of its current shares on the London Stock Exchange. By listing 10% of its outstanding shares, We Soda will be eligible to join the FTSE indices.
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The IPO will be London’s largest this year after a significant drop in IPOs due to the challenging economic environment that has lowered the market valuations of most private companies that would be interested in going public.
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However, We Soda is in a different boat altogether as global demand for its soda ash remains high, given the high demand for glass from multiple industries led by the liquor sector. The IPO is expected to raise 800 million US dollars (£645 million) for the company, valued at $8 billion.
We Soda intends to use about 500 million (£403 million) of the amount raised to repay some of its debts, with the remaining amount being set aside for corporate use. Ordinary investors will also get a chance to participate in the IPO via the PrimaryBid platform, where shares worth £6.95 million will be available.
The soda ash company noted that its products were a key ingredient in manufacturing glass, solar panels, and lithium carbonate used in EV batteries. Soda ash is also a critical ingredient in the making of powdered detergents.
The IPO will significantly boost the London public markets after five firms raised a meagre £81 million over the year's first three months. The IPO will be run by a combination of the leading investment banking firms, which will tap into their investor pools to raise the required amount.
Investors in the London Stock Exchange had been rattled after ARM, a chip manufacturer based in the UK, said that it would only list its shares in the United States, sidestepping its home market, which made many think that London had lost its attractiveness to newly listed companies, especially after Brexit.
However, We Soda’s IPO will provide a much-needed boost to the London IPO market, with many hoping that the listing will convince many other private companies to list on the London Stock Exchange.
*This is not investment advice.
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