UBER RAISES US$8.1B IN IPO
Ride-hailing firm sells 180m shares at US$45 each for US$75.5b market value
UBER Technologies Inc raised US$8.1 billion (RM33.67 billion) in its initial public offering (IPO) after pricing shares near the bottom of their marketed range.
The ride-hailing company sold 180 million shares for US$45 each, it said in a statement on Thursday. It had marketed them for US$44 to US$50 apiece.
Based on the amount of stock outstanding after the offering, the IPO price gives Uber a market value of US$75.5 billion, just below its last private market value of US$76 billion.
The fully diluted value, including restricted stock units and other shares, could be about US$82 billion.
Uber had prioritised selecting shareholders that it felt would hold on to the stock for a long time, according to a source.
The company was hoping to avoid the tumultuous first weeks of trading in rival Lyft Inc, whose shares fell below its US$72 IPO price within days of listing and
closed 23 per cent below that price on Thursday.
“We view Uber’s conservative pricing as a smart and prudent strategy coming out of the box as it clearly learned from its ‘little brother’ Lyft, and the experience it has gone through over the past month,” said Wedbush Securities analyst Dan Ives.
Uber’s biggest competitor briefly dipped below its last private value of US$15.1 billion in premarket trading on Thursday, before it rebounded to close at US$55.18 for a valuation of about US$15.8 billion.
Even at the low end of the price range, Uber’s listing is set to be among the 10 largest US IPOs of all time and the biggest on a US exchange since Alibaba Group Holding Ltd’s record US$25 billion in 2014, Bloomberg data showed.
Still, it was a considerable step down from earlier projections: Last year, bankers jockeying to lead the offering told Uber it could be valued at as much as US$120 billion in an IPO.
That’s partly because, after waiting a decade to go public, the most highly valued startup in the US was set to make its market debut amid less-than-ideal conditions.
US stocks fell for a fourth day Thursday, leaving the S&P 500 index on pace for its worst week of the year as trade tensions escalated between the US and China. Uber shares started trading on the New York Stock Exchange yesterday.
After submitting its confidential filing in December, Uber was left sitting on the sidelines while US stocks enjoyed the best start to a year in at least a decade.
The pricing and subsequent trading performance would be closely watched by other tech startups that are expected to go public this year, including Slack Technologies Inc, Postmates Inc, Peloton Interactive Inc and Airbnb Inc.
Like many of the IPO class of 2019, Uber is deeply unprofitable. It lost US$3.04 billion last year on an operating basis on revenue of US$11.3 billion, bringing total operating losses over the past three years to more than US$10 billion, according to filings.