Food delivery startup Deliveroo has changed the target value for its initial public offering on the London Stock Exchange, after some investors expressed concerns over workers’ rights and the company’s share ownership structure.
The Amazon-backed (NASDAQ:AMZN) company announced Monday that it will now sell shares for £3.90 ($5.40) to £4.10 each instead of £3.90 to £4.60 each. As a result, Deliveroo’s market cap will be between £7.6 billion and £7.8 billion, instead of between £7.6 billion and £8.8 billion.
Deliveroo said it’s reacting to market conditions, which have taken a turn for the worse in the last week. Half of the tech IPOs in the U.S., and in Europe, the Middle East, and Africa, priced in the bottom third of their announced ranges last week.
However, the new share price range announcement also comes amid an investor revolt. Several large investors said they plan to shun the Deliveroo IPO on April 7 over workers’ rights and the company’s share ownership structure, which gives CEO Will Shu over 50% of the voting rights.
The U.K.‘s largest fund manager, Legal and General Investment Management, which manages over £1.3 trillion in assets, said it probably won’t be involved, citing concerns around the gig economy that Deliveroo operates in and the company’s share ownership structure.
Aberdeen Standard and Aviva Investors, which manage over £800 billion between them, said they’re concerned about Deliveroo workers’ rights, while M&G Investments said it is also planning to skip on the IPO.
AMZN shares begin Monday at $3,052.03
