Instacart raises IPO price range after success of Arm listing

Receive free Instacart Inc updates

Instacart has raised the price range for its initial public offering following the success of Arm’s blockbuster debut this week, in the latest sign of a warming market for new US listings.

The online grocery delivery company boosted its price range by about 7 per cent to $28 to $30 per share in a filing on Friday, valuing the group at up to $10bn on a fully diluted basis.

The upward revision by San Francisco-based Instacart comes a day after UK chip designer Arm rose 25 per cent on its first day of trading on the Nasdaq exchange. The stock rose a further 3 per cent in early trades on Friday morning.

Previously, Instacart had sought between $26 and $28 per share, equivalent to about a $9.3bn value for the company. At the top end, that would raise $660mn compared with an earlier target of up to $616mn.

However, even after raising the range, the company would still be worth about a quarter of the private valuation it enjoyed two years ago.

Arm’s IPO is the largest US listing in almost two years, raising almost $5bn for SoftBank, the Japanese conglomerate that bought the Cambridge-based semiconductor company for $32bn in 2016.

Arm’s closing price on Thursday gave it a market capitalisation of $65.2bn based on shares outstanding, or nearly $68bn on a fully diluted basis.

That tops the $64bn valuation at which SoftBank last month bought out the remaining stake in Arm that it did not yet own from the Vision Fund, the $100bn Saudi-backed vehicle that is managed by SoftBank itself.

Source link