Cake shop chain valued at £170m

Shares in Patisserie Holdings, which also includes the brands Druckers and Philpotts, were priced at 170p on their stock market debut, which is at the low end of previous guidance for between 170p and 200p.

The pricing gave the company a valuation of £170m before shares - under the ticker CAKE - rose on their first day of dealings to 184p.

Entrepreneur and former Pizza Express chairman Luke Johnson reduced his stake in the company from 70 per cent to 42.7 per cent through the stock market listing.

The company, which has grown to 138 shops from eight at the time of Mr Johnson’s takeover in 2006, has raised £33m from the shares placing to pay down debt. The move will raise £46.5m for selling shareholders.

The first Patisserie Valerie cafe was opened on Frith Street in London’s Soho district in 1926 by Belgian-born Madame Valerie, whose vision was to introduce continental patisserie products to the UK.

For many years, Patisserie Valerie was run as a small group by the Scalzo family consisting of a partnership of three brothers - Enzo, Robert and Victor. They acquired the existing store in Soho, which had since relocated to Old Compton Street, in 1987 and took the group to eight sites.