Johnson makes £25m from IPO of bakery chain

 
Kasmira Jefford
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SERIAL entrepreneur Luke Johnson has pocketed around £25m after selling down his stake in Patisserie Valerie, which priced its initial public offering yesterday at the lower end of its range.

The chain, which runs five brands including Patisserie Valerie, Philpotts and Baker & Spice, listed on Aim yesterday under the ticker “CAKE”, priced at 170p a share.

While this was at the bottom of its 170p-200p price range, shares jumped nearly 15 per cent to 195p valuing it at £195m.

The chain raised £32.8m of new capital through the share placing to help pay own debt.

A further £46.5m of shares were sold by existing shareholders, with Johnson reducing his stake from 70 per cent to 42.7 per cent.

Patisserie Valerie’s management, including chief executive Paul May, have cut their 30 per cent stake to 5.9 per cent, leaving the group with a free float of 48.4 per cent.

Johnson said: “We have grown the business from eight stores to 138 today, and I’m delighted that our new investors have recognised the potential to roll out Patisserie Valerie further. We look forward to a strong future as a quoted company.”

The firm is the latest to join the rush to the stock market, although many have seen prices fall below their launch price, in a sign that the IPO market may be cooling.