By
Chimamanda U. Martha
March 11th, 2024
Although Amazon stands to gain the most from the IPO, Deliveroo’s CEO Will Shu will be the biggest individual winner after the offering.
Amazon.com Inc (NASDAQ: AMZN) is positioned to gain the most after a successful initial public offering (IPO) of online food delivery company Deliveroo. Deliveroo announced its IPO plans on the 4th of March when it declared London as the location for the company’s public offering. At the time, Deliveroo said it would be adopting a dual-class structure for its upcoming listing on the 7th of April. Deliveroo’s stock ticker is currently unknown, but options are “ROO” and “DROO.”
Amazon to Gain Most from Deliveroo IPO
Now, Deliveroo is going public on the London Stock Exchange next month, and Amazon will have an 11.5% stake in Deliveroo after the IPO. Deliveroo intends to generate £1 billion or $1.38 billion from the public offering. The company said it would offer up to 256,456,256 shares between the prices of £3.90 and £4.60 per share. Upon a successful IPO, Deliveroo’s value would be between £7.6 billion and £8.8 billion.
Also, Deliveroo stated in its prospectus published on the 23rd of March that existing shareholders plan to offer 128,205,128 shares.
The IPO will generate hundreds of millions for Deliveroo’s top shareholders. Even if the company eventually sells shares at the lower end of the range, Deliveroo is set to emerge as the largest tech IPO in Europe so far in 2021. Also, the company will be the largest tech public offering in Britain for over 10 years.
Amazon currently holds a 15.8% stake in Deliveroo. The company plans to sell 23,302,240 shares between £90.8 million and £107.2 million, depending on each share’s pricing.
Although Amazon stands to gain the most from the IPO, Deliveroo CEO Will Shu will be the biggest individual winner after the offering. At the moment, Shu owns 90.570.400 shares in the company, which represents 6.1% of share capital. After the IPO, the CEO will own 115,227,441 shares (6.3% of share capital) with more than 50% voting rights.
In a report, CNBC analyzed that Shu’s stake will be worth about £490 million after the IPO if Deliveroo offers its shares at £4.25 each. At the same time, Shu’s shares may be up to £530 million if Deliveroo prices at the top of the range, which is £4.60 per share.
Other Companies to Benefit as Deliveroo Goes Public
Some top shareholders positioned to benefit hugely from Deliveroo’s upcoming IPO include Index Ventures and DST Global. Others are Greenoaks Capital, T.Rowe Price Group, Bridgepoint, Accel, and Fidelity Investments.
Index Ventures currently holds 150,889,000 shares or 10.2% share capital in Deliveroo. The venture capital’s stake will be worth £641 million if Deliveroo prices at the mid-range.
Also, DST Global owns 148,676,600 shares (10.1% share capital”. The company’s stake will be worth about £632 million if Deliveroo offers each share at the mid-range. Index Ventures and DST Global plans to sell about £15 million shares for around £6 million.