On Monday, Instacart declared an offer price of between $26 and $28 per share for its Initial Public Offering (IPO). The company will make available 14.1 million newly issued shares and 7.9 million existing shares. If the higher end of the pricing range is chosen, the company could raise approximately $616 million.
On Monday, Instacart filed an updated registration statement for its impending initial public offering (IPO), indicating that it aims to raise up to $616 million and have a valuation of up to $7.7 billion. The company expressed that its offer price will be between $26 and $28 per share, with a total of 22 million shares composed of 14.1 million newly issued shares and 7.9 million from selling stockholders. If the higher end of the scale is reached, it would result in $616 million in proceeds. Instacart will have 276 million common stock outstanding (279.3 million if underwriters opt to purchase more) for a likely valuation of around $7.7 billion. This number could increase to $7.8 billion if the underwriters select to buy additional shares. PepsiCo, meanwhile, is set to become an investor through purchasing $175 million in shares. Goldman Sachs — one of the underwriters — will be an agent in connection with the private placement and will be paid a fee equivalent to 1.5% of the purchase cost of the shares. Furthermore, Norges Bank Investment Management and several other firms have expressed interest in becoming cornerstone investors in this IPO, purchasing up to $400 million in the offering, although Instacart has reiterated that underwriters could choose to sell more, fewer, or no shares to any of the cornerstone investors.
Instacart, one of the largest U.S. online grocery delivery firms, is among the most anticipated public flotations of the year. Competition in the sector is fierce, with traditional retailers competing alongside tech firms like Amazon, DoorDash, GoPuff, and Grubhub. The company's recent IPO filing is timely, considering the upcoming blockbuster debut of British chip design firm Arm, which could be valued at as much as $52 billion. Arm stated that the New York IPO is expected to generate up to $4.87 billion in fresh capital.The success of such IPOs will be crucial in evaluating the strength of the market, which has been on a virtual freeze for the past year due to higher interest rates and increasing inflation. Investors are optimistic; however, it is market conditions on the day of listing that will ultimately determine how the offerings fare.
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