Snowflake IPO Raises 3.36 Billion Dollar in US Listing
Late Wednesday, Snowflake said that its initial public offering raised $3.36 billion (around Rs 24,711 crore) after its price was above the target range on the largest U.S. listing so far this year.
The IPO, priced at $120 (approximately Rs 8,830) per share, values north of $30 billion (approximately Rs. 2, 20,606 crores) for the cloud-based data storage business.
San Mateo, California Snowflake on Monday, it said it planned to sell 28 million shares at $100 (approximately Rs. 7,350) to $110 (approximately Rs. 8,090) per share after its estimated price rose last week from $75 (approximately Rs. 5,520) to $85 (approximately Rs. 6,250) per share.
Snowflake’s IPO dwarfs that of Royalty Pharma, which had become the largest IPO so far in 2020. It also underlines the recent rebound on the U.S. market for new stocks since COVID-19, the pandemic caused some companies to suspend IPO plans.
Snowflake was filed for public release in confidence earlier this year, shortly after its last February financing which valued it at more than $12 billion (about Rs. 88,246 crores). Before the offering, Venture capital firm Sequoia held an 8.4 percent interest in the company.
At the end of January, Snowflake’s revenue rose 173.9 percent to $264.7 million (approximately Rs. 1,946 crores). Its net loss almost doubled to $348.54 million. (Rs. 2,563 crore roughly).
The company’s stock is scheduled to start trading on Wednesday on the New York Stock Exchange under the “SNOW” ticker symbol, and the bid is expected to close on September 18.
The principal underwriters of the offer are Goldman Sachs, Morgan Stanley, JP Morgan, Allen & Co, and Citigroup.
Snowflake builds the cloud-based database software which offers critical technological infrastructure in a new way.
With legendary chief executive Warren Buffett avoiding young tech firms and IPOs for decades, the offer has generated enough interest to draw investment from Berkshire. With the investment of $250 million, Berkshire is acquiring more than 4 million IPO price shares from former Snowflake CEO Robert Muglia.
Snowflake Inc. created this week’s largest initial public offering for a U.S. software company, which might not be the most incredible aspect of its first share sale.
Snowflake SNOW has persuaded one of the most coveted investment partners in the world, Berkshire Hathaway Inc., by +111.60 percent. BRK.A, +0.30% BRK.B, +0.29%, to spend more than half a billion dollars in its IPO, in spite of the legendary aversion of founder Warren Buffett to young technology firms and IPOs.
Berkshire and Salesforce.com Inc are not alone. CRM, -0.42 percent also contribute millions of dollars to a company predicted to bring in about $4 billion at an estimation of about $33 billion just eight years after its creation.
