Uber IPO raises $12.2b
NEW YORK: Uber Technologies Inc priced its initial public offering yesterday at the low end of its targeted range to raise $US8.1 billion ($NZ12.2 billion), adopting a riskaverse stance toward the most highprofile US listing since Facebook Inc seven years ago.
Uber’s IPO came against a backdrop of turbulent financial markets, fuelled by the trade dispute between the United States and China, as well as the plunging share price of its US rival Lyft Inc. It assigns a valuation to Uber of $US82.4 billion, significantly less than the valuation of up to $US120 billion its investment bankers predicted last year.
The IPO was oversubscribed, but Uber settled for a lower price to avoid a repeat of Lyft’s IPO in late March, which priced strongly but was followed by a plunge in the company’s shares. Uber also wanted to accommodate big mutual funds, which unlike hedge funds put in orders for a lower price.
Uber said it priced its IPO at $US45 per share, toward the bottom end of its $US44$US50 per share price range.
Some still consider the stock overpriced.
‘‘Uber is basically Lyft 2.0. Good model, growing sales. But, yet again, here comes California math once more. It is still losing a ton of money,’’ Brian Hamilton, a tech entrepreneur and founder of data firm Sageworks, said.
‘‘If you buy, you are buying a bull market, not a company,’’ he said.
In meetings with potential investors the past two weeks, Uber chief executive Dara Khosrowshahi argued Uber’s future was not as a ridehailing company, but as a wide technology platform shaping logistics and transportation.
Uber lost $US3.03 billion in 2018 from operations, and reported a net loss attributable to the company for the first quarter of 2019 of about $US1 billion on revenues of roughly $US3 billion. — Reuters