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Reddit is targeting an impressive valuation of $6.4 billion and hopes to generate a minimum of $500 million. In its public offering, Reddit intends to make available 15.3 million shares, each priced between $31 and $34. Major financial entities like Morgan Stanley, Goldman Sachs, JPMorgan, and Bank of America will supervise the procedure. Additionally, Reddit is providing its long-term users with the initial opportunity to invest.
Reddit is preparing for a substantial initial public offering (IPO) with plans to generate over $500 million, potentially placing the social media behemoth at a remarkable $6.4 billion valuation. This action could have extensive consequences for other privately-held startups contemplating going public in 2024.
The firm is scheduled to begin its promotional tour this coming Monday. The goal is to attract investors to take part in a listing on the New York Stock Exchange. This step is expected to invigorate the Initial Public Offering (IPO) market after a slow two-year phase.
Reddit has intentions to make available 15.3 million shares, each priced between $31 and $34. The procedure will be supervised by leading financial organizations such as Morgan Stanley, Goldman Sachs, JPMorgan, and Bank of America.
Reddit's worth is projected to be anywhere between $5.8 billion to $6.4 billion when fully diluted, which is significantly less than its $10 billion value during the last private funding round in 2021. If everything goes as expected with the listing, Reddit might be able to accumulate up to $519 million.
Furthermore, current stockholders will offload an additional 6.7 million shares, and close to 2 million shares are set aside for acquisition by users and moderators who became members of the platform prior to January 1.
The choice to go public is made in the midst of a slow US initial public offering (IPO) market, where even new listings are struggling to draw in investors. Reddit's IPO is expected to act as a benchmark, measuring the interest of both professional and individual investors in a market known for its intense price sensitivity.
Even though Reddit's considerable advertising income, which played a huge role in its $800 million sales last year, the company still hasn't been able to generate a yearly profit. In fact, they reported a loss of $91 million in 2023.
Furthermore, there are worries that the initial public offering might lure trading activities based on speculation, similar to the chaotic retail trading experienced with stocks such as AMC and GameStop.
Established in 2005 and bought by Condé Nast in the following year, Reddit became an autonomous offshoot under Advance Publications in 2011. As its initial public offering (IPO) is forthcoming, Reddit is set to make a substantial impact on public trading markets.
(Incorporating information from various sources)
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