Mumbai: Uber Technologies Inc priced its IPO on Thursday at the low end of its targeted price range for a valuation of $82.4 billion. It hoped, the approach will save it the trading plunge suffered by rival Lyft Inc.
Uber raised $8.1 billion, pricing its IPO at $45 per share, near the bottom of the targeted $44-$50 price band.
However, the IPO still represents a watershed moment for Uber, which has grown into the world’s largest ride-hailing company since its start 10 years ago.
The year’s biggest IPO comes against a backdrop of turbulent financial markets, fuelled by the trade dispute between the United States and China, as well as the plunging share price of Lyft, which is down 23 percent from its IPO price in late March.
Uber’s valuation through IPO is almost a third less than its investment bankers predicted last year but manages to be still above its recent valuation of $76 billion in the private fundraising market.
The IPO was comfortably oversubscribed, but Uber settled for a lower price to avoid a repeat of Lyft’s IPO in late March, which priced strongly then plunged in trade. Uber also wanted to accommodate big mutual funds, which unlike hedge funds put in orders for a lower price.
“Uber is basically Lyft 2.0. Good model, growing sales. But, yet again, here comes California math once more. It is still losing a ton of money,” Brian Hamilton, a tech entrepreneur and founder of data firm Sageworks said to reporters. “If you buy, you are buying a bull market, not a company,” he added.
Uber will begin to trade on the New York Stock Exchange on Friday by the symbol “UBER.”