Deliveroo CEO Will Shu.
Aurelien Morissard | IP3 | Getty Images
LONDON – Deliveroo plans to raise £ 1bn ($ 1.38bn) in its initial public offering next month, when it is expected to debut on the London Stock Exchange.
The food delivery service intends to offer up to 256,456,256 new shares, from £ 3.90 to £ 4.60 per share, according to the company’s prospectus, which was published on Tuesday. Existing shareholders also intend to sell up to 128,205,128 shares.
The IPO will value the company at between GBP 7.6 billion and GBP 8.8 billion, which is higher than previous reports had suggested. Even at the lower end of the range, Deliveroo will continue to be the largest technology IPO in Europe to date and the largest in the UK for a decade.
Deliveroo’s IPO is intended to make the company’s major shareholders hundreds of millions. Some of them will download some shares to the IPO, but investors intend to keep most of them.
The biggest individual winner will be Deliveroo CEO Will Shu. Following the IPO, it will hold 115,227,441 shares, or 6.3% of the share capital. It will also have over 50% of the voting rights. Assuming that Deliveroo prices are 4.25 pounds per share, the midpoint of the range, Shu’s stake will be worth around 490 million pounds. However, it could go up to 530 million pounds, if the price is at the top of the range.
In general, Amazon is the one that earns the most from the IPO. The technology giant will hold an 11.5% stake (209,720,160 shares) in Deliveroo after the IPO, which will be worth around £ 1 billion depending on price. It currently owns 15.8%, but intends to sell 23,302,240 shares for GBP 90.8 million and GBP 107.2 million, depending on prices.
Meanwhile, Index Ventures, which also backed Facebook and Slack, will remain with a 7.5% stake, worth about £ 577 million, if prices are average while DST Global, which also supported fintech Checkout in the UK, will be left with a 7.4% stake worth GBP 569 million. Both companies plan to sell about 15 million shares for about 60 million pounds.
Other VCs that will win big include Greenoaks, T. Rowe and Fidelity, which will also have stakes between £ 450m and £ 500m each. Meanwhile, Bridgepoint and Accel will have stakes of around £ 300 million, if prices are average.
The Deliveroo listing will take place on April 7th. The stock marker is currently unknown, but options include “ROO” and “DROO”.
The company’s prospectus shows that Deliveroo’s revenues increased by 54% in 2020, while gross margin increased from 24% to 30%. However, Deliveroo recorded another year-round loss of £ 224 million.
It comes after US rival DoorDash was valued at $ 60 billion in a transaction on the New York Stock Exchange in December. Meanwhile, Grubhub was valued at just $ 5 billion when it went public in 2016.