Uber is seeking a valuation of $82.4bn, less than the $100bn it was hoping for, but still making it one of the largest IPOs of all time, and one of the most hotly anticipated stock market listings in the tech world since Facebook made its Wall Street debut seven years ago.
The San Francisco-based ride-hailing app is asking investors to pay $45 per share, according to a regulatory filing published ahead of Friday’s listing on the New York Stock Exchange.
At that price, Uber announced, it would raise $8.1bn to fund expansion into new markets and the continued development of expensive projects such as its driverless car and food-delivery divisions.
But it had hoped for a higher valuation. Appetite for the stock is thought to have been dampened by the limp performance of shares in rival Lyft, which floated in March and has since lost 27% of its IPO strike price.
Uber has never made a profit – and warned in its lengthy but lightly informative investment prospectus for the float that it may never do so.
With investors cautious about its prospects, it settled on an asking price of $45, at the low end of a range it had set of between $44 and $50.
It will issue 180m new shares, while existing investors, including directors, co-founder Travis Kalanick and its largest shareholder, the $100bn SoftBank Vision Fund backed by Saudi Arabia, are also selling stock. Between them, investors will sell 27m shares, cashing in to the tune of $1.27bn.
Chief executive Dara Khosrowshahi is expected to ring Wall Street’s famous opening bell, amid reports that Kalanick – who resigned as its boss following a string of scandals in 2017 – will not appear for the Friday morning ceremony.
The performance of the shares on their first day of trading will gauge investors’ confidence in the prospects of a company that has expanded rapidly from taxi services into food delivery. Uber is also investing billions in developing driverless cars.
Despite the scale of its ambition, Uber lost $1.8bn last year even while its revenues surged by more than 40% to $11.3bn. Figures released alongside its float plans showed it lost a further $1bn in the first three months of this year.
But its data-packed float prospectus revealed the sprawling scale of its operations in 700 cities. Between taxi and food delivery services, Uber boasted 91 million users a month by the end of 2018. Users of its vehicles travelled 26bn miles last year, summoning an army of 3.9 million drivers.
Those drivers have earned $78.2bn between them since 2015 – and $1.2bn in tips since Uber gave users the option to add a gratuity in mid-2017.
