Square Outlines IPO Terms
November 06 2015 - 8:20AM
Dow Jones News
Payments startup Square Inc. on Friday said it plans to raise up
to $403.7 million in its initial public offering amid what has been
a rocky IPO market.
The San Francisco company, known for its credit-card readers
that attach to mobile devices, is run by Twitter Inc. co-founder
and Chief Executive Jack Dorsey. Mr. Dorsey owns about a quarter of
Square's stock.
Square said in a regulatory filing that it would sell 27 million
shares at $11 to $13 a piece. Underwriters will have the option to
buy an additional 4.05 million shares.
The offering comes in what has been a tough IPO market. Recent
sharp stock-market swings have deterred some firms from pursuing
public offerings, with one of the year's biggest IPOs—grocer
Albertsons Companies Inc.—recently scrapping plans.
The Square offering is seen as a harbinger for technology
companies valued at $1 billion or more—Square was valued by
investors last fall at about $6 billion. Many highly valued
companies, armed with private capital have stayed away from the IPO
market. There were just 22 tech IPOs through the third quarter this
year, compared with 53 through the third quarter of 2014, according
to Dealogic.
Like many other Silicon Valley tech firms, Square has been
posting growing sales but swelling losses. The company said sales
rose 54% last year to $850.2 million and are on a pace to exceed $1
billion this year. Its loss, meanwhile, widened to $154.1 million
last year from $104.5 million in 2013.
Including Mr. Dorsey's stake, venture-capital firm Khosla
Ventures's 17.3% stake and smaller shares held by board members and
executives, about two-thirds of Square is held by insiders.
Write to Lisa Beilfuss at lisa.beilfuss@wsj.com
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(END) Dow Jones Newswires
November 06, 2015 08:05 ET (13:05 GMT)
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