Reddit prices IPO at top of indicated range to raise US$748 million
SOCIAL media platform Reddit priced its initial public offering at the top of its targeted range of US$31 to US$34 per share on Wednesday, raising US$748 million and giving the ailing technology IPO market a much-needed boost.
The IPO priced 22 million shares sold by the company and its existing shareholders at US$34 a share, giving Reddit a valuation of about US$6.4 billion.
Excluding the shares sold by existing shareholders, Reddit raised gross proceeds of US$519.4 million. Reuters reported earlier on Wednesday that Reddit and its bankers were guiding they could price the IPO at the top of the indicated range or above.
The pricing of the IPO at the top of the range is a vindication of the company’s decision to lower its valuation expectations, after it was valued at US$10 billion in a private fundraising round in 2021.
The successful offerings of Reddit and Astera Labs could boost the lackluster tech IPO market after two years of largely subdued activity.
Earlier this year, the stock market launches of other big names including KKR-backed BrightSpring and sportswear brand Amer Sports received a lukewarm reception from investors.
GET BT IN YOUR INBOX DAILY
Start and end each day with the latest news stories and analyses delivered straight to your inbox.
In February, Reddit unveiled a US$66 million contract to provide training data to Alphabet’s Google.
Reddit said last week the US Federal Trade Commission was conducting an inquiry focused on the company’s sale, licensing, and sharing of user-generated content with third parties to train artificial intelligence models.
Reddit’s shares are expected to start trading on the New York Stock Exchange on Thursday under the ticker ‘RDDT’.
Morgan Stanley, Goldman Sachs, JPMorgan Chase and Bank of America are the lead underwriters for Reddit’s offering. REUTERS
KEYWORDS IN THIS ARTICLE
BT is now on Telegram!
For daily updates on weekdays and specially selected content for the weekend. Subscribe to t.me/BizTimes
Companies & Markets
Luxury group Richemont reports slowdown in Q4 sales, appoints new CEO
Vietnam forfeits billions of US dollars in foreign aid amid anti-graft freeze
Asia: Stocks mixed after Wall Street, Europe retreat from records
Mapletree closes second Japan logistics development fund, expects 110 billion yen AUM
Dolce & Gabbana metaverse fashion offering leaves shopper fuming
Microsoft offers cloud customers AMD alternative to Nvidia AI processors