dglobalnews.com Snapchat Parent Sets Valuation of Up to $22.2 Billion
Published: Fri, February 17, 2017
Research | By Kayla Price

Snapchat Parent Sets Valuation of Up to $22.2 Billion

Snap has raised about $2.7 billion in total funding to date from investors such as General Catalyst, IVP, Coatue Management and Benchmark.

The company, which filed for an IPO earlier this month, was widely expected to be valued at between $20 billion and $25 billion, giving it the richest valuation in a US technology IPO since Facebook Inc.

This would give Snap a share price of between $14 and $16 each, but a final IPO price will be decided once it has finished consulting with its investors from today (16 February).

Depending on the outcome of their roadshow - which is set to be held under the "SNAP" ticker - shares for Snap Incorporated could be priced as early as March 1. By the fourth quarter, average daily active user growth fell below 50% for the first time since at least 2014, according to the deal prospectus.

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"Even I was [surprised] by the slowdown in user growth, and user growth is very important at this stage", said Santosh Rao, head of research at Manhattan Venture Research, a merchant bank focused on the secondary market for late-stage venture-backed technology companies. It plans to list on the NYSE under the symbol SNAP.

"As a result, Mr. Spiegel and Mr. Murphy, and potentially either one of them alone, have the ability to control the outcome of all matters submitted to our stockholders for approval, including the election, removal, and replacement of directors and any merger, consolidation, or sale of all or substantially all of our assets", the regulatory filing reads. The company also said it is not "anticipating any material acquisitions" but may purchase some "complementary businesses, products or technologies". The filing also shows how the company has evolved over the past few years.

It marks the first US IPO to issue shares with no voting rights - something that prompted several of the largest US pension funds to send a letter of objection to Snap earlier this month, the Financial Times reported.

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