Food delivery company Deliveroo has priced its Initial Public Offering (IPO) at $12 billion U.S., making it the biggest stock market debut in the United Kingdom since commodities giant Glencore went public a decade ago.
The Amazon-backed (NASDAQ:AMZN)food delivery company’s stock market debut is being held up by the British government as a sign that the City of London can still attract major IPOs following the United Kingdom’s exit from the European Union.
Deliveroo will be London’s biggest IPO since Glencore went public in May 2011, according to data provided by the London Stock Exchange. Deliveroo will also be the biggest technology IPO ever on the London Stock Exchange.
The company has benefited from the closure of restaurants for anything other than takeout food during the COVID-19 pandemic and revenues have soared accordingly, with the total value of orders received rising 64.3% in 2020.
But the company faces questions on whether that momentum will continue after COVID-19 restrictions are eased and be enough to turn the business towards profit after it posted an underlying loss of 223.7 million pounds ($308.93 million U.S.) last year.
Deliveroo said it had set a price range for its listing of between 3.90 and 4.60 pounds per share which will give it a market capitalization of between 7.6 billion pounds and 8.8 billion pounds ($10.5 billion U.S. to $12 billion U.S.), excluding any shares offered as part of an over-allotment.
Deliveroo has opted not to pursue a premium listing, ruling it out of inclusion in the FTSE index, which allows founder and Chief Executive Officer Will Shu to retain enhanced shareholder rights.
JP Morgan (NYSE:JPM) and Goldman Sachs (NYSE:GS) are global coordinators and bookrunners on the IPO, along with Bank of America (NYSE:BAC), Citi NYSE:C), Jefferies and Numis.
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