The First Estonian Company On The Warsaw Stock Exchange

Silvano Fashion Group (PTA Grupp) is the first company from Estonia which has offered its shares on the Warsaw Stock Exchange. Debuting on 23 July, Silvano Fashion Group is the 5th foreign company bringing its shares to the WSE this year and the 38th company making a debut on Warsaw floor in 2007. With Silvano Fashion Group now quoted, the number of foreign companies on the WSE has gone up to 16. The reference price for the first WSE session stood at PLN 19,81.

Under this public offering the company’s major shareholder, Alta Capital Partners, sold 6,221,338 existing shares at the selling price of PLN 19.81. A total of 273 investors from Poland and other EU countries subscribed to the shares. With a total worth of PLN 123.3 million, the offering was placed exclusively with institutional investors. In the near future the company plans to issue 2,052,802 new shares, all to be taken up by Alta Capital Partners. This type of share issue was chosen for technical reasons. The company seeks to raise ca. EUR 10 million from the issue in order to expand its retail network in Eastern Europe.

At present Silvano runs 67 own outlets and plans to open another 42 shops by the end of this year. The company’s retail chain includes 19 shops with women’s fashion under the PTA brand, located in Lithuania, Latvia, Estonia and Russia. Moreover, the company sells women’s lingerie in a chain of 19 shops under the Oblicie brand in Russia, 20 Milavitsa-branded shops in Belarus, 2 Lauma shops in Latvia and 7 Splendo outlets in Poland. Apart from Silvano’s own shops there are also 105 retail outlets operating on a franchise basis, selling its products under the Milavitsa brand in countries such as Russia, Ukraine, Moldova and Kazakhstan.

Apart from the retail chain, the company runs 3 plants, manufacturing clothes and lingerie in Estonia, Latvia and Belarus.

The Estonian company was the 38th player to make its debut on the Warsaw floor this year. 38 is the number of all debuts throughout the entire 2006. In terms of the number of debuts in Q2’2007 the Warsaw bourse holds the second position in Europe, remaining among Europe’s leaders in this category for some years now. Between 2004 and today a total of 147 companies have made it to the Warsaw floor, the aggregate value of their offerings approaching PLN 40 billion (over EUR 10.5 billion).

Earlier this year, in mid-April the management of the Estonian company publicly announced that it was contemplating a Warsaw debut in order to improve the liquidity of its shares, facilitate access to Eastern European markets and add further momentum to its growth.

The Warsaw Stock Exchange now has 16 listed foreign companies from Austria, Czech Republic, Estonia, Germany, Hungary, Israel, Luxembourg, Netherlands, Slovakia, Spain, Ukraine and the USA. Silvano Fashion Group is the 5th foreign company making its WSE debut this year. According to WSE’s forecasts, between 6 to 8 foreign companies are expected to be floated on the Warsaw floor in 2007.

The first quotation of the Estonian player came into being through the involvement of the Polish National Depository for Securities (KDPW). On 11 July KDPW signed a relevant contract establishing a connection with the Estonian Central Register of Securities EESTI VÄÄRTPABERIKESKUS (EVK), which enabled operational services to issuers from Estonia.

¹ The company is being renamed from PTA Grupp into Silvano Fashion Group.

Table 1. Foreign companies quoted on the WSE.

* Astarta – Ukrainian company registered in the Netherlands; Cinema City – Israeli company registered in the Netherlands; ACE – Spanish company registered in Luxembourg.