Several Wall Street banks have recently sent Uber proposals in which they attribute a value of up to 120 billion dollars to the taxi service. The proposals are intended for a possible IPO of the company at the beginning of next year. That’s what insiders say about the Wall Street Journal.
The documents provide advice on how to position shares for potential investors. It is customary for banks to make proposals before they are officially hired to subscribe to a so-called IPO. In the case of Uber, 5% of the proposals were made by Goldman Sachs and Morgan Stanley, according to the initiates.
The $120 billion valuation is almost double the valuation of Uber in an investment round two months ago. It is also more than the appreciation of General Motors, Ford and Fiat Chrysler put together.
In the documents, Uber states that it will make a profit in the next three years, according to the insiders. However, the company expects to have a turnover of between 10 and 11 billion dollars this year, which is much more than last year’s 7.78 billion dollars.
According to an agreement with investor SoftBank, the company should go public before the end of 2019, say insiders. If it does not, it should allow certain investors to sell their shares in another market. CEO Dara Khosrowshahi said earlier that the company plans to launch an IPO in the second half of next year. It is unclear how much the company intends to value this.
However, there is no guarantee that Uber will go public in the expected period of time, or with the valuation now proposed by bankers. The IPO market is rising and falling rapidly. 2018 was a strong year for technology, among other things, but circumstances may be less positive when Uber goes public. An insider therefore said that banks are proposing an earlier IPO, mainly because they fear that the IPO market will cool down again.
In the meantime there is a race between the taxi service and rival Lyft, who would also be planning to go to the fair in the first half of 2019. The valuation of that company is expected to exceed 15.1 billion dollars. Earlier this year, he himself sold shares at that price.
According to insiders, Lyft JPMorgan has appointed Chase & Co, Jefferies Group and Credit Suisse Group to lead an IPO at the beginning of 2019.This news article was automatically translated from Dutch to give Techzine.eu a head start. All news articles after September 1, 2019 are written in native English and NOT translated. All our background stories are written in native English as well. For more information read our launch article.