Zalando could close IPO books early after strong demand -sources

By Arno Schuetze and Alexander Hübner

FRANKFURT (Reuters) - Zalando, Europe's biggest online fashion retailer, is considering shortening the subscription period for its initial public offering (IPO) because of strong demand, sources familiar with the plans told Reuters.

Three financial sources said that the IPO is already oversubscribed and Zalando could close the books a day or two earlier than planned.

Zalando, which had been expected to list on the Frankfurt exchange on Oct. 1 in one of Germany's biggest technology stock flotations for years, declined to comment.

In an indication of robust demand, Zalando shares are already trading in the grey market well above the 18 euros to 22.50 euros price range set last week.

The Berlin-based company has said that it aims to raise between 507 million euros (398.74 million pounds) and 633 million euros from the IPO, including potential over-allotment shares, valuing the company at up to 5.6 billion euros.

Zalando, which began in 2008 by selling shoes in Germany, now ships 1,500 brands to customers in 15 countries. It was inspired by the U.S. shoe and clothing retailer Zappos.com, which is now owned by Amazon.com.

The listing is part of a busy season for e-commerce IPOs, led by the mammoth New York listing of China's Alibaba. German firm Rocket Internet, which helped to launch Zalando and numerous other e-commerce sites, is also poised to list in the coming weeks.

Zalando has said it already had cornerstone investments of about 127 million euros, including from Scottish Mortgage Investment Trust.

The listing is being co-managed by Morgan Stanley, Goldman Sachs and Credit Suisse.

All existing shareholders plan to remain fully invested, with the listing to be made up entirely of new, primary shares.

Swedish investment firm Kinnevik is Zalando's biggest shareholder and will have a post-IPO stake of about 31.6 percent, assuming full exercise of the over-allotment, followed by a 14.8 percent stake held by the investment vehicle of Germany's Samwer brothers, the founders of Rocket Internet.

(Additional reporting by Freya Berry; Writing by Emma Thomasson; Editing by Georgina Prodhan and David Goodman)