EPO.com, the Swedish online investment bank, is preparing a merger with German rival Virtuelles Emissionshaus. The merged company – to be called EPO.com Online Investment Bank – will aim to be the number one pan-European player in EPOs.
An EPO is carrying out the complete issue process for an IPO – from publication of the prospectus to the registration and distribution of shares – over the web.
Independent, virtual investments banks like EPO.com and Virtuelles are vulnerable to the online offerings of established investment banks – boasting formidable resources and a proven track record – and a predicted slowdown in initial public offerings (IPOs) as public markets turn increasingly bullish.
By combining their membership lists – which add up to 120,000 registrations – and complementary European operations, the merging banks hope to position the new company as the only pan-European “e-manager” for IPOs. They want to persuade the Goldman Sachs and Morgan Stanleys' of this world to bring them into an IPO syndicate to handle the online distribution of shares, instead of developing their own EPO capabilities.
Both EPO.com and Virtuelles are yet to complete an EPO outside their domestic markets, but are hoping EPO.com OIB will shortly carry out its first UK transaction, pending FSA approval.