Enter the giant

Unicredit, Europe's third largest banking group, became the largest entity to be traded on the Warsaw Stock Exchange when it floated on December 20, 2007. With a capitalization of some E80 (zł.290) billion, the Milan-based firm lifted the bourse's overall market capitalization to more than zł.1 trillion, an amount comparable to Poland's GDP.

The company's authorized share capital on the WSE stood at more than EUR 6.6 (zł.24) billion, and comprised around 13.3 billion shares. The debut price of zł.20.25 per share grew to zł.29.80 on the day of the debut.

Unicredit's flotation came as a result of an agreement with the banking watchdog on the takeover of part of Bank BPH. When Italian bank Unicredito merged with German bank HVB, the resulting entity, Unicredit, was forced to break up HVB's Polish subsidiary Bank BPH. Part of it merged with Unicredito subsidiary bank Pekao and the remainder, known as "Mini BPH," will be sold to GE Money.

Unicredit retains its 59.36- percent stake in Poland's largest commercial bank Pekao, giving the Italian giant a controlling share in the domestic bank.

The IPO was impressive by WSE standards, yet the number of shares was limited as the firm's shares are mainly traded on the Italian Borsa Italiana in Milan and the Frankfurt Stock Exchange where the group is already listed, noted analysts.

"The turnover [on the WSE] will be virtually nothing," Bankier.pl analyst Michał Macierzyński told WBJ. The major benefit will be that of prestige, since the presence of a giant will draw other big international investors, Macierzyński added.

Marcin Bogucki, an analyst from brokerage DM IDMSA, agreed with Macierzyński. He said, "Although the decision was purely political, this is a positive signal for the WSE and its investors." 

The investors most interested in Unicredit's shares will be insurance and pension funds, as they will be attracted by the firm's stability, Bogucki and Macierzyński pointed out.