Largest Czech IPO

Czechoslovak Group (CSG) is entering the Amsterdam Stock Exchange. The company offered 15.2% of its shares at a price of €25 per share and is heading for a total valuation of around €25 billion. The CSG share offering took place through a private institutional channel in the form of accelerated bookbuilding, rather than a traditional IPO. The offered volume was snapped up by institutional investors almost immediately.

After trading began on the stock exchange, the price hovered around €32 per share. At this price, CSG's market value exceeded approximately €33 billion, or roughly CZK 800 billion, significantly surpassing the value of ČEZ.

The primary issue of CSG shares is an extraordinary event not only in terms of the size of the transaction itself, but also in terms of the institutional anchoring of Czech companies on capital markets. Although it is a purely Czech group, its entry onto the stock exchange did not take place on the Prague Stock Exchange, but on Euronext Amsterdam. This in itself speaks to the limitations of the domestic market.

In terms of volume, this is a transaction of unprecedented scale. According to available information, CSG's market valuation at IPO could reach approximately EUR 25 billion, or roughly CZK 600 billion. In the Czech context, this is a leap in size of an order of magnitude that has no historical precedent. By way of comparison, the largest IPOs of Czech companies to date – Moneta Money Bank's listing in 2016 and Avast's IPO in 2018 – ranged from a few billion to less than ten billion CZK in market capitalization. CSG's IPO is many times larger than these and is approaching the size of medium-sized European issues.

However, the choice of Amsterdam is not an exception. Another Czech company, Eurowag, took a similar path, conducting its IPO in London on the London Stock Exchange instead of Prague. In both cases, the main factors were greater liquidity, a broader investor base, and the greater experience of foreign stock exchanges with issues of this size and complexity.

The CSG IPO is therefore not only a record transaction in terms of Czech business, but also further evidence of a structural problem in the domestic capital market. The Czech economy is capable of generating companies of European significance, but the local stock exchange is not yet able to offer them the appropriate infrastructure. In this sense, the CSG IPO is more a symbol of the untapped potential of the Prague Stock Exchange than its success.