Airbnb said Wednesday that he had filed a confidential application for an initial public offering (IPO) to the SEC, the future number of shares and price has not been determined. The move follows the encouraging news in the tourism sector and increase the number of bookings on the platform Airbnb in June.
Well-known worldwide company for short-term rentals Airbnb Inc said on Wednesday that he had filed a confidential application for an IPO with the SEC (the Commission on securities and stock exchanges of the USA).
As said an analyst at investment firm DA Davidson: “In mid-March and April, it was hard to imagine that Airbnb will go public this year”.
According to media reports, the original plans Airbnb provided for access to the public markets through direct listing and not through the IPO, because this method is less costly.
Airbnb has not provided detailed information on the future number of shares and their price, and called the timing of the completion of the IPO. However, according to Reuters, the company aims at listing before the end of 2020, “depending on market conditions”. Morgan Stanley (MS) and Goldman Sachs (GS) are the lead advisors on the IPO Airbnb.
The conditions of a pandemic COVID-19, and a sharp drop on its background airline and tourism industry, has become an obstacle to Airbnb plans to hold an IPO earlier this year, but in June Marketinfo.pro wrote that the company is again preparing to become public following the trends of improvements in the industry.
According to reports by Bloomberg in June the number of Airbnb bookings fell by 30% after a decline of 70% in may.
Recent quarterly reports Booking Holdings (BKNG) and Tripadvisor (TRIP), while it showed an unprecedented loss in their history, came in better than analyst estimates, and the company said they see some signs of recovery in travel demand since April.
According to the CEO of Airbnb Brian chesky, the company saw an increase in domestic tourism and change in customer preferences in favour of private housing. In addition, among the tourists has increased the average length of accommodation booking.
However, the financial position of the Airbnb looks difficult. Quarter ended June 30 showed a drop of Airbnb revenues by 67% to $335 million, with losses of $400 million.
The company has suspended marketing activities for the year, reduced 25% of its workforce worldwide and has attracted $2 billion in equity and debt to overcome the crisis COVID-19.
Airbnb market valuation fell to $18 billion, well below the $26 billion listed by the company as internal evaluation at the beginning of March.
“The leadership of Airbnb, probably suggests that loss of market value in 2020 can be compensated through raising funds as a public company, which will affect the growth potential of its stock,” said Andrea Valne, General partner at Manhattan Venture Partners and investor in Airbnb.
Last month Marketinfo.pro wrote that the IPO market is recovering after a lull early in the year, and some newcomers to the market, recent listing, despite the crisis of a pandemic, demonstrate strong growth results compared to the overall market.
“We believe that investors are willing to go beyond the problems related to COVID-19, and to evaluate the company based on the scenarios after the exit from the crisis,” said Kathleen Smith, Director of Renaissance Capital.
