Twitter IPO Flies High At $26 Per ShareBy: Val Powell - November 6, 2013
Twitter’s stock price has now been priced at $26 and will start trading from Thursday on the New York Stock Exchange (NYSE) under the symbol “TWTR”. The company is now valued at $18 billion, and it is expected that the IPO will raise about $1.8 billion to fund future expansion and About 70 million shares will be sold.
Earlier in the week, its IPO price had ranged between $23 and $25, but some analysts now say that the price may leap to as much as $50 once the trading starts, and it is widely expected that this IPO might be the second largest after Google’s 2004 that raised about $1.92 billion.
Twitter has been trying to avoid the trouble that marred Facebook’s IPO where its IPO offering was tarnished by a $10 million fine imposed by Nasdaq as a result of technical glitches and its Wall Street underwriters are doing everything they can to ensure that the process is a smoother one.
Barclays Capital will be the company’s designated market maker. The Role of the designated market maker is to allow human beings to trade stock, unlike what happens with all-electronics stock exchanges like Nasqaq.
It is interesting to note that Twitter has not made any profit since 2006; therefore, it goes public a much smaller company compared to others like Facebook, Google, and Linkedln. However, there is no doubting the fact that Twitter holds an important share in social media.
Facebook has five times as many users as Twitter, with cheaper IPO | http://t.co/PvIB6NsxbA
— Bloomberg News (@BloombergNews) November 7, 2013
Perhaps Twitter has chosen to go public at the time when it’s registering massive growth in its users. It should be remembered that Twitter’s active users rose by 25% in its first 9 months compared to 45% growth in the same period last year.
By the time Twitter goes public, Twitter Co-founder Evan Williams will own about 10.4% of the company’s share. The largest shareholder is Rizvi Traverse, who holds about 16% stake valued at $2.2 Billion. Others with a considerable stake in the company include Jack Dorsey ($609 Million), Peter Fenton ($820 Million) and CEO Dick Costolo (199 Million).
(image via twitter.com)