Daily Management Review

Post Q1 Loss, Uber Reveals Its IPO Terms


Uber updates its public filing for valuation expectations in the wake of Lyft’s poor performance post IPO.

On Friday, April 26, 2019, the Uber Technologies Inc revealed its terms for IPO and informed the investors that the company will seek to sell out nearly “$10.35 billion in stock at a valuation of up to $91.5 billion”. Revealing, further, the company also stated that PayPal has consented to buy “$500 million” stock in “a private placement at the price the IPO eventually settles at”.
One of Uber’s regulatory filing read that a “target price range” for IPO was at “$44-$50 per share”. As a result, the company will be selling out shares worth “180 million” in the offering while an additional “27 million” is to be sold by the present investors.
On the other hand, the filing also confirmed that the company has met with a loss of “around $1 billion and revenues of roughly $3 billion” in the Q1 of 2019. The updated version of the public filing syncs with the company’s preparation to start the roadshow for the investors, in the coming ten days, wherein the management will pitch Uber to the “public market investors”.
Investors will throw their questions at Uber, while the company may have to answer the expected time frame for profit returns, besides revealing about its plant of deal with the transition into “autonomous vehicles”, while it may also need to clarify it the company is equipped to “support higher driver costs from minimum wage rules”.
While, Reuters added:
“The valuation that Uber is seeking in its IPO is less than the $120 billion that investment bankers told Uber last year it could fetch, and closer to the $76 billion valuation it attained in its last private fundraising round last year”.
The medications effected at Uber in its valuation expectations is a reflection of Lyft’s “poor stock performance”, after it came out with its IPO last month. Lyft is a smaller rival of Uber.