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Wednesday, October 6, 2010

Pandora Raises 2 Billion in IPO

Danish jeweler Pandora charmed investors with an IPO worth up to $2.1 billion in one of Europe's largest market listings this year, Reuters and other media outlets report.

Pandora shares, priced at 210 Danish crowns in the initial public offering, closed up at 263, giving investors a 25 percent gain and valuing the company at about $6.1 billion, Reuters reports. More than 4 billion crowns ($739 million) of Pandora stock changed hands on the Copenhagen stock exchange—nearly double the normal daily turnover for the whole bourse. The company priced its IPO at the high end of a preliminary range of 175-225 crowns.

Analysts reportedly said Pandora's high growth and strong margins made the share offer attractive to investors hungry for new stock after a period of scant IPO activity, despite its short track record and heavy reliance on a single product.

Pandora's mass-market jewelry, sold mainly in the United States and Europe, is priced in an approximate $50-$1,500 range. The company makes customizable silver and gold charm bracelets, rings, necklaces and earrings at its three factories in Thailand, where it employs 3,300 people out of its total workforce of 4,500, and sells them in 45 countries.

Its big seller is charm bracelets, made of silver or gold, with the charms of stones such as amethyst, onyx or moonstone. It made 86 percent of first-half sales from bracelets and charms.

Pandora, founded in 1982 by husband-and-wife team Per and Winnie Enevoldsen as a Copenhagen shop, has grown rapidly over the past decade, with revenue of about $640.4 million in 2009. Axcel, the Danish private equity group, bought a 60 percent stake in the company from the Enevoldsen family two years ago.

Pandora made 41 percent of its first-half sales in the United States, the company reportedly said.