Bending Spoons, the unquoted Italian digital turnaround company, has filed plans for a $20bn (£15bn) flotation in the US, boosting Baillie Gifford European Growth (BGEU) and its private equity stable mate Schiehallion (MNTN), which both hold it as a top position.

BGEU, a £306m investment trust trying to revive its performance under new fund manager Joe Faraday, yesterday announced an uplift in the valuation of Bending Spoons following its filing for an initial public offering (IPO) on the Nasdaq technology exchange on Tuesday.

As a result, Bending Spoons has risen to account for 11.8% of the investment trust’s assets, up from 9.7% at 31 May. It is its only unquoted investment.

Schiehallion, a £2.2bn investment trust almost wholly dedicated to “transformational” late-stage private companies, revealed that Milan-based Bending Spoons now made up 15.2% of net asset value, up from 13% at the end of last month.

While Schiehallion shares have been flat this week, BGEU has risen nearly 7%. The news is well timed coming two months after Faraday overhauled the publicly listed portfolio of his predecessors Stephen Paice and Chris Davies. After a 28% total loss over five years, the growth fund urgently needs to improve returns to avoid holding a 100% tender offer in 2028 that could threaten its viability.

Schiehallion is better placed. Having recovered from the 2022 growth crash, its shareholders have enjoyed a 197% total return over three years. Its performance has been propelled by SpaceX, an 11.6% holding heading for a record $1.78trn flotation on Friday, as well as other hot IPO prospects such as Anthropic, Databricks and Stripe.

Bending Spoons is reportedly aiming to raise $1.5bn in a rapid flotation by the end of this month, although it has not stated the number of shares it will sell or at what price.

According to the prospectus, the company has assembled a portfolio of digital brands that generated a 95% increase to $1.31bn in revenues last year with net profit of $27.5m in the first quarter of this year.  

In a letter to prospective invesstors, chief executive Luca Ferrari wrote: “We see a vast opportunity ahead. We’ve identified more than 1,000 digital businesses (both private and public) that could be attractive acquisition targets in the future.”

Our view

James Carthew, head of investment company research at QuotedData, said: “It is good to see Baillie Gifford European getting some private valuation uplift action after its sister trusts have hogged all the headlines with SpaceX and Anthropic. Bending Spoons could be thought of as a European software conglomerate, it buys businesses with interesting products – such as Vimeo and WeTransfer – and puts money and talent behind improving and growing them. The company has filed for an IPO on NASDAQ, looking for a valuation of about $20bn. We suspect that before this uplift, Baillie Gifford was valuing the company at $11bn, which suggests there could be more upside to come.”

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