Robinhood Markets seeks up to $35b. valuation in mega US IPO
Zoom to buy cloud-based call center operator Five9 in $15b. all-stock deal
Robinhood Markets, Inc. is targeting a valuation of up to $35 billion in its initial public offering in the United States, the company revealed in a filing on Monday, setting the stage for one of the highly anticipated stock market listings of the year.
The listing plans come just months after the online brokerage found itself at the center of a confrontation between a new generation of retail investors and Wall Street hedge funds in late January.
Robinhood was aiming for an IPO valuation of up to $40b., Reuters had previously reported.
About 55 million shares are being offered in the IPO to raise over $2.3b. Nearly 2.63 million of those shares are being offered by the company’s founders and chief financial officer, the filing showed. Proceeds from those will not go to Robinhood.
Shares are expected to be priced between $38 and $42, the company said.
Salesforce Ventures, the investment arm of software provider Saleforce.com Inc, is looking to purchase up to $150 million worth of Class A common stock at the IPO price, the filing showed.
Robinhood was founded in 2013 by Stanford University roommates Vlad Tenev and Baiju Bhatt. They will hold a majority of the voting power after the offering, the filing showed, with Bhatt having around 39% of the voting power of outstanding stock while Tenev will hold about 26.2%.
The company’s platform allows users to make unlimited commission-free trades in stocks, exchange-traded funds, options and cryptocurrencies. Its easy-to-use interface made it a go-to for young investors trading from home during coronavirus-induced restrictions and its popularity has soared over the past 18 months.
Also Zoom Video Communications, Inc. announced a $14.7b. all-stock deal to buy cloud-based call center operator Five9 Inc. in its largest-ever acquisition, as competition intensifies in its core videoconferencing sector.
The teleconferencing services provider has become a household name and investor favorite in the year since the coronavirus pandemic, as businesses and schools adopted its services to hold virtual classes, office meets and to socialize.
The San Jose, California-based company is now shifting focus to its two-year-old cloud-calling product Zoom Phone and conference-hosting product Zoom Rooms as bigger players Facebook and Alphabet’s Google amp up their video products.
Five9, whose call center software is used by more than 2,000 clients across the globe to interact with their clients, counts firms such as Under Armour, Lululemon Athletica Inc and Olympus Corp as customers.
The deal makes strategic sense, as it helps accelerate Zoom’s product roadmap outside of its core offering, Barclays analyst Raimo Lenschow wrote in a note. (Reuters)