Airbnb Inc has said that it is aiming for a valuation of up to $34.8 billion in its initial public offering (IPO), in what would cap a stunning recovery in its fortunes after the US home rental firm's business was heavily damaged by the COVID-19 pandemic earlier this year.
In a regulatory filing, Airbnb set a target price range of between $44 and $50 apiece to sell 51.9 million shares, which would pull in $2.6 billion. Airbnb could end up selling $2.85 billion at the upper end of the range.
Of the shares being sold, Airbnb founders Brian Chesky, Joe Gebbia and Nathan Blecharczyk will together sell nearly $100 million worth of shares in the IPO launch.
Airbnb struggled in the immediate aftermath of the pandemic as travel came to a grinding halt. It had to lay off a quarter of its workforce and seek $2 billion in emergency funding from investors, including private equity firms Silver Lake and Sixth Street Partners.
But as lockdowns eased, more travellers opted to book homes instead of hotels, helping Airbnb to post a surprise profit for the third quarter. The San Francisco-based firm also gained from increased interest in renting homes away from major cities.
"Looking at Airbnb there's a lot to like. The company's third quarter has shown they've bounced back better than a lot of their travel rivals," senior strategist at IPO research firm Renaissance Capital Matthew Kennedy said.
At the top of Airbnb's target range, the IPO will give Airbnb a fully diluted valuation, which includes securities such as options and restricted stock units, of $34.8 billion. This is nearly double the $18 billion Airbnb was worth in an April private fundraising round and above the $31 billion it was worth in its last pre-COVID-19 private fundraising in 2017.
Airbnb's market capitalisation at $50 per share would total $29.8 billion. Chesky's stake would be valued at approximately $3.8 billion, while those of Gebbia and Blecharczyk would be worth approximately $3.5 billion each. Sequoia Capital, which first invested in Airbnb in 2009, would have a stake worth more than $4 billion.
Airbnb plans to list on December 10 under the symbol "ABNB" on Nasdaq.
Underwriters For The IPO
Morgan Stanley and Goldman Sachs are the lead underwriters for the IPO.