At US$10 billion, Uber’s listing to be largest since Alibaba’s in 2014
- Company to seek valuation of between US$90 billion and US$100 billion
Uber Technologies has decided it will seek to sell about US$10 billion worth of stock in an initial public offering, and will make public the registration of the offering on Thursday, people familiar with the matter said on Tuesday.
A listing of this size will make Uber’s one of the biggest technology IPOs of all time, the largest since that of Chinese e-commerce giant Alibaba Group Holding, which owns the South China Morning Post, in 2014.
Uber is seeking a valuation of between US$90 billion and US$100 billion, influenced by the poor performance of smaller rival Lyft’s shares following its IPO last month, the sources said. Investment bankers previously told Uber it could be worth as much as US$120 billion.
Uber was most recently valued at US$76 billion in the private fundraising market.
Most of the shares sold will be issued by the company, while a smaller portion will be owned by Uber investors cashing out, one of the sources said.
Uber plans to make its IPO registration with the US Securities and Exchange Commission publicly available on Thursday, and will kick of its investor roadshow during the week of April 29, putting it on track to price its IPO and begin trading on the New York Stock Exchange in early May, the sources said.
The sources cautioned the plans were still subject to change and market conditions, and asked not to be identified because the matter was confidential.
A representative for Uber declined to comment.
Lyft’s IPO priced it at the top end of its upwardly revised range last month, assigning it a valuation of more than US$24 billion in an offering that raised US$2.34 billion. But the stock has traded poorly since debuting on the Nasdaq on March 29, as concerns about the start-up’s path to profitability have become more prominent. Its shares ended trading on Tuesday at US$67.44, well below their US$72 IPO price.
In moderating its valuation expectations, Uber is showing a realism that is being increasingly adopted by Silicon Valley unicorns, as stock market investors push back against some of the lofty price tags sought.
On Monday, Pinterest set a price range for its IPO that values it below the US$12 billion at which the online image-search company sourced its last private fundraising in 2017.
Uber operates in more than 70 countries. In addition to ride-hailing, its business includes bike and scooter rentals, freight hauling, food delivery and an expensive self-driving car division.
During the IPO roadshow, Uber’s chief executive, Dara Khosrowshahi, will be tasked with convincing investors he has successfully changed the company’s culture and business practices after a series of embarrassing scandals over the past two years.
Those have included sexual harassment allegations, a massive data breach that was concealed from regulators, use of illicit software to evade authorities and allegations of bribery overseas.
Uber last year had revenue of US$11.3 billion, while gross bookings from rides was US$50 billion. But the company lost US$3.3 billion, excluding gains from the sale of its overseas business units in Russia and Southeast Asia.