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Snap seeks USD 3.2bn IPO
Posted on Thursday, 16 February 2017 14:11
Snap, the owner of the social media photo sharing application Snapchat, has priced its initial public offering (IPO) below valuation expectations previously thought to be between USD 20.00 billion and USD 25.00 billion.

The Californian messaging and multimedia platform operator, which has attempted to diversify by launching video camera sunglasses, said it is hoping to raise as much as USD 3.68 billion for general corporate purposes.

It is selling 145.00 million new stocks alongside 55.00 million shares put on the block by investors ranging from Benchmark Capital and Lightspeed to founders Evan Spiegel and Bobby Murphy.

The offering on the New York Stock Exchange is set at a price between USD 14.00 and USD 16.00 apiece and includes an overallotment option for 30.00 million existing scrips.

At this range, the overall valuation of USD 16.20 billion to USD 18.52 billion based on there being 1.16 billion common A and B stocks outstanding following the IPO.

Zephyr, the M&A databased published by Bureau van Dijk, shows Snap’s listing is set to be the third-largest within the Zephus classification of computer, information technology and internet services companies in the last decade.

The company is following in the footsteps of PayPal (2015) and Alibaba (2014) and its offering will be more than Facebook’s USD 16.00 billion debut in 2012.

Furthermore, it is on course to become the first technology company to float so far this year, according to Zephyr.

Snap was formed in 2012 as Future Freshman, which changed its name to Toyopa Group in 2011, followed by Snapchat in 2012 and finally its current moniker in 2016.

The camera application that was created to help people communicate through short videos and image has, on average, 158.00 million users daily, according to the filing.

In the 12 months ended 31st December 2016, it generated revenue of USD 404.48 million (FY 2015: USD 58.66 million) and had widened net loss to USD 514.64 million from USD 372.89 million in FY 2015.

© Zephus Ltd