GrubHub IPO expected this weekContinue reading.
GrubHub raises IPO price range
THE ASSOCIATED PRESS
Online food delivery company GrubHub lifted its estimate for how much its IPO will raise, signaling demand from investors.
The Chicago company on Tuesday predicted that its initial public offering would generate as much as $202.1 million, up from its estimate of $177.9 million in March and $100 million in February.
In a filing Tuesday, GrubHub anticipated a sale of 7 million shares for $23 to $25 each, with 4 million coming from the company and 3 million from early investors. The banks managing the IPO could buy another 1.1 million shares, adding to the proceeds. GrubHub, which won’t get money from the investors’ sales, plans to use its share of the proceeds to run the business.
Not counting the extra stock sale to the bankers, GrubHub would be worth as much as $1.96 billion after the IPO.
GrubHub, which also owns the Seamless food ordering website, connects nearly 29,000 restaurants with users in more than 600 U.S. cities. At the end of 2013, about 3.4 million people had placed an order through GrubHub in the past year.
The service frees restaurants and customers from taking and making phone calls when food is ordered. But competition is tough as restaurants can use other online ordering services.
Restaurants pay a percentage of each order to the online delivery service. GrubHub’s 2013 revenue rose 67 percent to $137.1 million, helped by its merger with Seamless.
GrubHub’s stock is expected to list on the New York Stock Exchange under the “GRUB” ticker symbol. The shares are expected to price on Thursday night and trade Friday.