February 12, 2020 / 5:26 PM / in 10 days

Huuuge Games readying IPO inspired by CD Projekt performance - sources

WARSAW (Reuters) - Mobile games applications provider Huuuge Games is preparing for an Initial Public Offering (IPO), most likely in Warsaw, encouraged by the performance of Poland’s best known video games maker, CD Projekt, banking and broking sources said.

The Warsaw bourse has faced a decline in turnover and has struggled to attract new listings as companies can often find cheaper funding via other routes.

But the global success of CD Projekt, whose market capitalisation has risen almost 20 times in the last five years to 29.77 billion zlotys ($7.63 billion), has made the Polish gaming sector attractive for investors.

“Huuuge Games is heading towards the stock exchange,” said a person familiar with Huuuge plans, who wished not to be identified. The person added that the IPO would most likely include up to 40% of existing shares.

Another source confirmed Huuuge Games was preparing for an IPO this year.

“We are considering various strategic options related to the further development of Huuuge Games. No decisions have been made...,” a spokeswoman for the company told Reuters in an e-mailed statement.

Huuuge Games, whose revenue amounted to 221 million zlotys ($56.62 million) in 2018, is also looking for a full-time investor relations director based in Warsaw, according to an announcement published on a Polish popular job search website on Feb. 2. The deadline for applications is Thursday.

“Ideally served as the IR Director or pre-IPO consultant to a public Polish company, before during and/or after IPO,” one of the requirements for the job said.

Poland has developed into a leading video game exporter due to low labour costs, a young, educated workforce and a thriving gaming tradition rooted in the Communist era.

The combined value of the listed gaming companies leapt 82% to more than 32 billion zlotys last year, led by CD Projekt, 11 bit studios, PlayWay and Ten Square Games, according to Warsaw bourse data.

“Global funds are interested in the Polish video games sector. CD Projekt has done a good job and Poland is now associated with a place where one can make decent money on video games producers,” said Grzegorz Miechowski, chief executive at 11 bit studios.

Reporting by Agnieszka Barteczko and Anna Koper; editing by David Evans

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