Deliveroo would enter the public market by selling around 1 billion pounds of new shares in the US IPO.
By Pavankumar on Mar 16, 2021 | 04:36 AM IST
On Monday, Deliveroo announced its decision to enter the public
market with its IPO. The company, backed by Amazon [AMZN] has planned to sell around 1
billion pounds ($1.39 billion) of new shares in its upcoming initial public
offering (IPO). This IPO is expected to be the biggest London listing in more
than seven years. The food delivery company said in its regulatory fling that
its listing would also include the sale of shares by some existing
shareholders, potentially pushing the deal size even higher.
The company is expecting a market valuation of $7 billion through
the deal, which would be the largest London IPO. In the filing, the company
said it would have two classes of shares, with founder and chief executive Will
Shu to be the sole holder of “class B” stock which will give each of his shares
20 votes, whilst all other shares will carry one vote. The deal is designed to
protect Deliveroo from a hostile takeover. The company said the deal would last
for three years. The deal is led by Goldman Sachs and JP Morgan. Bank of America,
Citi, Jefferies and Numis are also part of the syndicate of banks managing the
transaction.
Right
now, London-listed companies cannot have a dual-class structure and gain access
to the lucrative FTSE indices at the same time. But this would change if recommendations
from a recent listings review are put in place.