Shares in Italian filter maker GVS jumped almost a fifth on their Milan debut on Friday after the company seized on coronavirus-related demand for protective medical equipment to raise €497m in Europe’s second-largest initial public offering this year.

GVS, which makes medical filters and biohazard masks, saw its share price rise above €9.70 in morning trading, up more than 19 per cent from the stock’s offer price of €8.15. The company’s offering to institutional investors was six times subscribed, with 61m new and existing shares sold, representing a 35 per cent stake.

The deal resulted in a bumper payday for the Scagliarini family, formerly the company’s sole owners, which received €416m from the sale of existing shares via their holding company GVS Group. A further 9m of family-owned shares could be sold if bankers decide to exercise a so-called “greenshoe” option, which allows underwriters to sell additional shares.

The float was the second largest in Europe this year, following on from an IPO by coffee group JDE Peet’s, which raised €2.25bn in May. The European IPO market has been slow to recover from the first-quarter jitters among investors caused by the pandemic, which has put many deals on hold. Those that have floated have tended to be winners from the crisis, such as videoconferencing platform Pexip. 

Bologna-based GVS, which began contemplating a listing late last year, said proceeds from the sale — €81.5m of which will go to the company — would be used to expand the business, including possible acquisitions. 

Massimo Scagliarini, chief executive, said he expected GVS’s full-year revenue to jump by as much as 41 per cent compared with 2019, driven by strong sales and an order backlog in the company’s health and safety division. 

GVS said demand for personal protective equipment had been five times greater this year than in 2019, prompting the group to ramp up the production of items such as filters for the ventilators used in intensive care units.

Although asset markets have recovered from their March lows, many groups have been reluctant to restart the IPO process because of uncertainty over sales. 

“For the next six months those companies that do get away . . . will be in the kind of sectors that either Covid-19 hasn’t impacted or, if it has, that [the effect has been] to their benefit,” said Carlton Nelson, co-head of corporate broking at Investec. The virus would “weigh on the track record of companies for a good few years”, he added.

Gareth McCartney, head of equity capital markets in Emea at UBS, said there had been “green shoots of IPO activity” in Europe in recent weeks, with companies actively preparing for the autumn window. Investors preferred “companies which are liquid and can demonstrate growth or a sustainable dividend yield”, he said.

Investment banks Goldman Sachs and Mediobanca acted as joint bookrunners on the deal.

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