Line prices shares, plans to raise over $1 billion in IPO

Steven Loeb · July 11, 2016 · Short URL: https://vator.tv/n/466f

The mobile messaging app will be having a dual IPO in the U.S. and Japan

The tech IPO market this year has been all but dead, with only two companies, Twilio and SecureWorks, choosing to go that route so far. They are about to get a little bit of company, though, as Japanese mobile messaging app Line is planning a dual IPO this week, going public both in its home country and in the U.S.

The company priced its public offering at 115.5 billion yen or $1.13 billion, at the top of its range, according to a report from Bloomberg on Sunday.

Line is planning to sell 35 million shares at 3,300 yen apiece.;$25.3 million of those shares will be offered in the U.S. at $32.84 a piece. On top of that, there will also be another 5.25 million shares sold through a "green shoe option," which is a provision that gives the underwriter the right to sell investors more shares than originally planned.

At this price, the company is being valued at roughly $6.9 billion, making the biggest tech debut of the year. Shares of Line will begin trading in New York on Thursday, and in Tokyo on Friday. 

This comes as the company is seeing increased sales, growing 40 percent to 120.7 billion yen in 2015, but with a loss of 7.6 billion yen.

Line had originally planned to go public in 2014, and was said to be valued at over 1 trillion yen, or $9.8 billion. The company eventually scuttled those plans, however, instead putting its focus on its international expansion.

IPO market

2015 was a bad year for IPOs. There were 169 IPOs, which raised $30 billion in 2015. Not only was that a 39 percent drop in volume, and a 65 percent drop in money raised, but numbers were the lowest since 2009, which was right in the heart of the recession.

This year is even worse, especially for technology, with Line being only the third tech IPO of 2016 so far. 

The first was SecureWorks, which went public in April, raising $112 million at $14 a share, a lower price than it has originally expected. That was followed by Twilioi in June, which raised $150 million at $15 a share, above its targeted range.

There's still a chance for the tech IPO market to bounce back. Some of the companies thought could go public this year include virtualization data management company Actifio, open source integration platform MuleSoft, Web-scale converged infrastructure company Nutanix, indentity management service Okta, and subscription billing platform Zuora.

(Image source: line.me)

Read more from our "Trends and news" series

More episodes

Related News