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Food delivery company Deliveroo is set for a big win following plans to list on the London exchange.
Deliveroo is one of a handful of companies that have benefited from the lockdown. On the brink of extinction, the food delivery platform made a remarkable recovery after the demand for online delivery platforms skyrocketed following the COVID-19 outbreak. Now to ensure innovation and continued growth, the company is set for a landmark listing. After speculation, Deliveroo announced on Monday plans to go for an IPO in London. In further confirmed it expects to sell shares between £3.90 and £4.60, raising its value up to £8.8B ($12B).
Given the valuation, this would not only be a big win for Deliveroo but the London exchange as well. According to Reuters, It will be the biggest listing since Glencore’s IPO in 2011. In amidst, economic uncertainty caused by the pandemic which has been aggravated by Brexit, this will be a win big for the country. It is also, as the founder and CEO Will Shu noted, emotional significant as London is the city that the platform began. The CEO further commented on the need to keep their foot on the gas:
“Becoming a public company will enable us to continue to invest in innovation, developing new tech tools to support restaurants and grocers, providing riders with more work and extending choice for consumers, bringing them the food they love from more restaurants than ever before.”
Deliveroo Timely IPO
The listing comes at a time when the government is working hard to attract tech companies to the country. Authorities have been relaxing legislations such as SPACs (Special-purpose acquisition company) rules to attract new companies. It is further reviewing allowing companies to list dual-class shares. This allows a class of shareholders (mostly founders and CEOs) to have more voting rights. Deliveroo has opted for this structure and CEO Will Shu is set to enjoy 20 votes per share. Common shareholders on the other hand will have one vote per share.
In terms of performance, Deliveroo seems to be surpassing expectations. Despite lockdowns easing, Deliveroo has started the year strong. The company stated that in the first two months of the year, its processed transactions more than doubled. In the U.K, CNBC reports that volumes grew by 130% year-on-year.
“We have seen a strong start to 2021 and we are only at the start of an exciting journey in a large, fast-growing online food delivery market, with a huge opportunity ahead,”
Retail traders are still in a stock craze. Deliveroo will be among the favorite companies after its strong start to the year.