Hotel Chocolat Shares Soar 33% on Buoyant London Trading Debut

  • First day of dealings resembles AIM success Fevertree Drinks
  • Gain comes after offering was `substantially oversubscribed'

Hotel Chocolat's Sweet IPO Debut

Hotel Chocolat Group Plc shares soared on their London trading debut as investors savored the U.K. purveyor of high-end chocolate.

Sold at 148 pence in an initial public offering, the stock rose as much as 33 percent to 197.5 pence on the Alternative Investment Market, valuing the Royston, England-based company at 223 million pounds ($322 million).

The debut bore similarities to Fevertree Drinks Plc, the U.K. maker of tonic water and ginger beer, whose shares rose 23 percent on their AIM introduction in November 2014. Fevertree shares have more than quadrupled since the IPO, boosting the company’s market value to 698 million pounds.

“You could say that investors are sweet on the chances of Hotel Chocolat becoming the next Fevertree,” said Nick Bubb, an independent retail analyst in London.

Hotel Chocolate’s IPO raised 55.5 million pounds, of which 43.5 million pounds went to founders Angus Thirlwell and Peter Harris along with some senior managers. The company netted 12 million pounds to accelerate its expansion plan.

Founded in 1993, Hotel Chocolat has grown to become one of the U.K.’s best-known chocolate retailers. The company now has 84 stores and about 500,000 online customers. Money raised in the IPO will be used to open new stores, expand manufacturing facilities and improve its online business, the company has said.

The offering was “substantially oversubscribed” and attracted a “wide spectrum of investors,” Thirlwell said in a phone interview last week.

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