Poundland Investor Warburg Pincus to Sell 10% Stake After Surge

Poundland Group Plc’s biggest shareholder, Warburg Pincus LLC, said it plans to sell a 10 percent stake in the U.K. discount retailer, days after Poundland’s share price surged on the purchase of one of its main competitors.

The private-equity firm will sell 25 million Poundland shares to institutional investors in an offering organized by JPMorgan Chase & Co. and Credit Suisse Group AG, according to a statement released after markets closed Tuesday. The sale will reduce its stake in the 600-store chain to 20.4 percent.

Warburg Pincus bought Poundland from Advent International in 2010 and partially exited its investment last year in an initial public offering of the U.K. retailer. The stake sale comes less than a week after Poundland agreed to buy 99p Stores for 55 million pounds ($84 million), a deal that sent its share price soaring 15 percent on the day it was announced.

“Warburg Pincus remains a significant and supportive shareholder of the company, its management team and strategy,” the private-equity firm said in the statement.

The stock fell 0.5 percent to 416.9 pence in London Tuesday, compared with an IPO price of 300 pence.

Warburg Pincus has undertaken not to sell any more Poundland shares for 90 days after the latest sale.

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