Everything you need to know about the Oatly IPO

 

 

 

What is Oatly?

Oatly is a Swedish vegan milk maker, producing a sustainable alternative to dairy products using oats. It was formed in the 1990s following research from Lund University, which led Oatly to patent its enzyme technology that turns oats into a milk substitute.

 

The Oatly IPO: what happened to Oatly shares on day one of trading

Oatly’s IPO took place on Thursday 20 May 2021, listing its shares under 'OTLY' on Nasdaq. Oatly's shares were listed at $17 each, but quickly rose to $22 in opening trading. 

Oatly’s IPO has been likened to that of vegan food tech Beyond Meat – the world’s first public vegan meat alternative. Just like Beyond Meat (BYND), Oatly's shares jumped significantly on the first trading day. While Oatly shares quickly rose from $17 each to $22 each, Beyond Meat shares were initially priced at $25 but quickly began trading at $46 a share, before ending its first trading day at over $65.

Oatly offered 65 million shares, raising $1.43bn. The capital raised would be used to fund growth, and give a chance for existing investors to cash in on their holdings.

Find out more about potential upcoming IPOs in 2021.

How much is Oatly worth?

Oatly was valued at more than $13bn (£9.2bn) at the opening of trading on May 20. The IPO was expected to be extremely popular thanks to the IPO boom and the growing interest in sustainable – specifically plant-based – stocks.

 

How does Oatly make money?

Oatly makes money through sales of its oat milk but the brand does also make plant-based ice cream, custard, cold coffee and yoghurt. Oatly’s signature milk is widely used as a household alternative, while its ‘barista’ oat milk is used in cafés to create milk for cappuccinos and macchiatos. 

The company has also made money through nine funding rounds. Aside from its controversial backer Blackstone, Oatly has received funding from Oprah Winfrey, Jay-Z’s Roc Nation company, Hollywood actor Natalie Portman and the Belgian family investment group Verlinvest.

Is Oatly profitable?

As far as we know, yes. Oatly had revenues of approximately $200 million in 2019 – double the previous year – and was aiming to double its sales again in 2020, but no figures have been made public.

We do know that Oatley’s sales have skyrocket throughout the pandemic, which has accelerated the trend toward dairy alternatives. In the US, total sales of non-dairy milks rose 23% to approximately $2.2 billion in 2020, while sales of oat-based products reached $288 million.¹

What is Oatly’s strategy?

Oatly’s strategy is based on the growing demand for plant-based equivalents to dairy. The movement away from dairy is largely fuelled by environmental concerns — especially around gas emissions from cattle — and research that dairy-free food is healthier. Demand for Oatly's products has been so great, that in early March 2021, the company announced it would be opening one of the world's biggest plant-based dairy factories in the UK as early as 2023.

Since its founding, Oatly has especially been popular among younger generations thanks to its conscious sustainability-based mission. But in 2020, it faced considerable backlash over its decision to receive $200 million in funding from investment group Blackstone.

Consumers criticised the private equity group’s sustainability credentials and its chief executive Stephen Schwarzman’s history of supporting Donald Trump. In 2019, the Blackstone Group financed companies that contributed to deforestation in the Amazon – not something Oatly consumers thought aligned with the brand’s ethos.

At the time, a spokesperson for Oatly said they were hoping ‘their investment in Oatly will set an example and create a ripple effect in the financial community. We have the opportunity to show how companies built around sustainability are not only commercially viable, but also strategic investments for the future.’

Who are Oatly’s competitors?

Oatly’s main competitors are companies such as Danone – which produces the plant-based Alpro brand – organic food delivery firm Abel & Cole, and plant-based yoghurt company Chobani. In fact, Chobani has also reportedly been considering a listing, which has also been valued between $7 to $10 billion.

Who owns Oatly?

Oatly is a self-proclaimed independently run and owned company, although it lists the following owners:

• Verlinvest
• China Resources
• Industrifonden
• Blackstone Growth
• Östersjöstiftelsen
• Orkila Capital
• Rabo Corporate Investments
• Founders
• Private individuals and employees²

Who are the directors of Oatly?

Name	Position
Toni Petersson	Chief Executive Officer
Daniel Comiskey	Chief Operating Officer
John Schoolcraft	Global Chief Creative Officer & Creative Director
Per Johansson	Senior Corporate Coordinator
Fredrik Frimodig	CIO & Head of Business Technology Message

How to trade Oatly shares

You can trade Oatly shares in the same way you would any other publicly-traded company on the stock market.

Just open an account and search 'Oatly' in our platform to start trading, or learn more about share trading with us.

¹SPINS, 2020

²Oatly, 2021