(Recasts with chief executive comments)
By Sarah Morris
MADRID, April 8 The chief executive of Spanish
online travel agency eDreams Odigeo played down an
opening-day drop in his company's shares on Tuesday, saying his
focus remained on long-term developments regardless of
short-term share moves.
The stock fell as much as 7 percent in what some saw as part
of a broader investor reaction against internet-related share
"I'm sure that in the same way that they (the shares) fell,
they will rise again," Chief Executive and founder Javier
Perez-Tenessa said in an interview after the ringing of the
opening bell at the Madrid stock exchange.
"We've been focused for 14 years on creating long-term
Despite the negative market debut, the flotation, the first
by a company in Spain in three years, marked another stage in
the country's recovery from a deep recession and showed
improving demand for Spanish assets among investors.
Perez-Tenessa said international investors from Britain,
France, the United States and Germany had put 433 million euros
into shares in the company, valuing it at 1.5 billion euros
including debt of 390 million.
EDreams Odigeo, which offers online deals on flights, hotels
and travel insurance, is the first Spanish company to go public
since 2011, disregarding two real estate investment vehicles
which listed earlier this year.
The flotation comes after high-profile U.S. technology
listings such as Facebook and Twitter, but also
follows last month's opening-day fall of Candy Crush maker King
Digital Entertainment, seen by many analysts as casting
a shadow over other web-linked IPOs.
Perez-Tenessa said it was important to distinguish between
technology companies without revenues and those with growing
income. His company grew core earnings or EBITDA by 62 percent
in 2013, though it made a net loss of 23.3 million euros and
said in its prospectus it won't pay a dividend for the near
Its shares closed down 4.3 percent from their sale price at
9.81 euros, after falling as low as 9.47 euros. By comparison
Spain's index of 35 most-liquid companies was down 1.2
"The stock was not especially cheap for a company that is
practically a technology firm. The market may be a little
dubious because of that," said Alejandro Varela, a fund manager
at Spain's Renta 4. But he said the drop was surprising given
the healthy demand for the placement.
The company, which offers deals in 42 countries through
websites such as Go Voyages and Opodo, priced its IPO at 10.25
euros per share. The price range had been narrowed to between 10
and 10.25 euros from an original range of 9.25 to 11.50 euros.
For Spain the flotation still counts as a success, given
many investors were drawn into the 2011 IPO of bailed-out lender
Bankia, only to lose out in its state rescue less than
a year later.
In its offering, eDreams Odigeo sold 4.8 million new shares
and 31.8 million shares belonging to existing shareholders
including senior management and private equity firms Permira
and Ardian. It plans to use part of the funds to pay
down debt and lower interest costs.
(Additional reporting by Sonya Dowsett and Sarah White; Editing
by David Holmes)