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The Day Lion Was King

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At 7 am on August 11, about 200 Lion Bioscience staffers, friends, and family, wearing plastic wristbands and corporate-blue baseball caps, piled into buses in the company’s parking lot in Heidelberg and set out on the Autobahn to Frankfurt.

It was IPO day and everybody was invited. Thure Etzold, inventor of Lion’s SRS product, jetted back from a vacation in Cuba for the event, as did seven UK staffers, and six from the US.

Taking your whole company to the NeuerMarkt isn’t IPO tradition in Germany, but neither are caged stuffed animals, musical performances, and dry ice.

Lion’s public offering, which was 50 times oversubscribed and ended up as the biggest volume biotech IPO in all of Europe this year, was a public spectacle. As a filmmaker followed the company’s board, bankers, and founders around the trading floor, the rest of the team sat at the nearby Bull and Bear café, sipping coffee and beer (free with the wristband), and watched their offering unfold on TV monitors.

On the sidewalk, reporters and passersby stopped to check out the lifelike roars coming from under a curtain draped over a large cage that was parked in front of the cafe. Meanwhile, the morning business reports were abuzz with the news of Lion’s offering, and their correspondents lined up to grab soundbites from the company’s photogenic CEO, Friedrich von Bohlen.

Gerrit Frohn, the lead book runner at Morgan Stanley who was inside the stock exchange for the offering, says the trading price was set at 44. Twenty minutes later when the first trade was made at 65, cheers erupted and champagne corks popped in the café.

When von Bohlen and his squad emerged from the exchange, a local show tunes celebrity took to the mist-covered stage and sang the Lion King theme song while the cage was dramatically undraped, revealing an enormous taxidermal lion.

Lion has the timing of the Human Genome Project announcement in June to thank for a lot of the buildup around its IPO. Says Christian Marcazzo, Lion’s director of product marketing who admits he overslept until 6:40 that morning and nearly missed the bus, “When we went to market investors associated our name with EMBL, EBI, and Celera.”

Marcazzo, an American, notes that pre-IPO practices in Germany also allow companies to build hype for themselves in a way US companies can’t. “There’s no such thing as a quiet period in Germany,” Marcazzo says.

In the weeks preceding its offering, Lion aired a 30-second TV commercial three times a day on Germany’s equivalent of CNBC. The spot, which featured a fierce lion pounding across a sandy terrain, told viewers to “put a lion in your portfolio.” Within two seconds after its first airing, the TV station’s call center got 18 requests for Lion prospectuses.

Andrea Kresselmeier, Lion’s director of business development who pulled the event together, says the day was an emotional one for the staff that had been working for years towards going public. “It was such an overwhelming moment, a lot of people had tears in their eyes. The sun was shining and everyone was so happy. The shares went so well—nearly a 50 percent increase over the offering price.”

According to Frohn, Lion ended its IPO day with a valuation 77 times what its sales figures were at the end of March 2000. The party ended around 6:00 the next morning.

— Adrienne Burke

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