Astera is seeking $534 million in IPO with AI appeal
Astera Labs Inc. and its investors are seeking to raise as much as $534 million in an initial public offering as the Intel Corp.backed semiconductor connectivity company seeks to tap investor demand for artificial intelligence plays.
Astera plans to sell about 14.8 million shares, while existing shareholders are offering another 3 million, the Santa Clara-based company said Friday in a regulatory filing. The stock is being offered at $27 to $30 a share, the filing shows.
At the top of that range, the company would have a market value of $4.5 billion based on the outstanding shares in its filings. Including stock options and restricted share units, Astera would have a diluted value closer to $5 billion.
The listing is set to be the biggest by a tech company since Klaviyo Inc.'s $659 million IPO in September. While that and chip designer Arm Holdings Plc's $5.23 billion offering failed to restart the listing engine, the market has warmed up substantially this year, led by Amer Sports Inc.'s $1.57 billion IPO.
Social-media company Reddit Inc. is planning to move ahead with its longdormant listing, too. It's plan was to begin marketing its shares on Monday and is eyeing a valuation of as much as $6.5 billion in an IPO this month, Bloomberg News has reported.
Klarna `soon'
Klarna Bank AB, the Swedish fintech that was once Europe's most valuable startup, is moving forward on a potential U.S. listing that could be one of the largest IPOs this year, Bloomberg reported last month. Klarna Chief Executive Officer Sebastian Siemiatkowski said Friday in a Bloomberg TV interview that he is preparing for an IPO “quite soon.”
Founded in 2017, Astera develops semiconductor-based connectivity solutions with the aim of enabling the “mainstreaming” of AI and machine learning in the cloud, according to its website. Astera tapped into investor bullishness on AI as part of a 2022 funding
round led by Fidelity Management & Research that raised $150 million at a $3.15 billion valuation. The company's investors include Intel's venture arm.
Nvidia Corp. and other AI-related stocks have soared over the past year, helping to lift stock indexes to record highs.
Shrinking losses
In 2023, Astera cut its net loss to $26 million on revenue of $116 million, compared with a loss of $58 million on revenue of $80 million the previous year, according to its filings.
Astera's biggest shareholder is Sutter Hill Ventures, which will control 12.8% of the company's stock after the listing. Funds affiliated with Fidelity will have a 6.5% stake, the filings show.
The IPO is being led by Morgan Stanley and JPMorgan Chase & Co., with participation from Barclays Plc, Deutsche Bank AG, Evercore Inc., Jefferies Financial Group Inc. and six other banks. Astera is planning for its shares to trade on the Nasdaq Global Select Market under the symbol ALAB.