Virgin Wines is to float on the London Stock Exchange next month with a valuation of about £100m as the Covid-19 pandemic increases demand for its home delivery business model.
The company, bought out of Sir Richard Branson’s Virgin group in 2005, mostly sells wine through its WineBank and Wine Plan subscription schemes, but also on a pay-as-you-go basis. It has 169,000 active customers, of which 147,000 are members of its subscription schemes.
The company has benefited as people have been spending far more time at home during the pandemic, and pubs and bars have been shut during lockdowns. It said customers were spending more to buy high quality wine. The off-trade market for wine specialists was estimated to be worth £2.4bn last year.
Jay Wright, the Virgin Wines chief executive, said: “We have enjoyed strong, consistent growth recently resulting in the group delivering more than 1m cases of wine to consumers during 2020. Underpinned by the strength of our customer proposition as well as the benefit of many positive consumer trends, we have a clear strategy to continue this growth over the coming years.”
The company plans to list on London’s junior Aim market on 2 March and is targeting a valuation of £100m. Virgin Wines is following in the footsteps of Deliveroo, Moonpig and the Hut Group, which have also opted for stock market debuts and benefited from big pandemic-related shifts in consumer spending. Moonpig’s shares shot up 17% when the online greetings card and gift retailer joined the stock market in early February and it is now valued at £1.5bn.
City investors have been eager to snap up shares in internet businesses that have thrived during the pandemic. The Hut Grouplisted in September at £4.5bn and its shares rose 25% on the first day, in the biggest London stock market debut since 2013.
Deliveroo, the London-based takeaway delivery service, is gearing up for a blockbuster stock market flotation, expected next month. It secured a further $180m (£130m) funding from shareholders including Amazon in mid-January in a move that valued it at more than $7bn.