Airbnb files for IPO as concerns over impact of COVID-19 ease

Covid-19 News | International | Latest News | Leisure & Tourism | Mergers & Acquisitions

Home rental giant Airbnb has filed initial public offering (IPO) with US regulators, setting the stage for one of the most highly-anticipated US stock market debuts in history. Goldman Sachs and Morgan Stanley are lead advisers on the IPO.

The move continues the trend of a rebound in parts of the leisure and travel sector – which was decimated by the onslaught of the COVID-19 pandemic, and subsequent lockdowns experienced across the world.

Airbnb revealed that in July, customers had booked more than 1 million nights in a single day for the first time since before the coronavirus-enforced lockdown.

Shares of U.S. online travel agency Booking Holdings Inc have rebounded around 14% in the past three months but are still down for the year.

Companies can confidentially submit an IPO registration with the U.S. Securities and Exchange Commission. If Airbnb moves forward with the IPO, the filing would be made public closer to the time of the listing.

The number of shares Airbnb will offer has not been revealed. A short statement from the company read: “Today, Airbnb confidentially submitted a draft Registration Statement on Form S-1 to the Securities and Exchange Commission (the “SEC”) relating to the proposed initial public offering of its common stock. The number of shares to be offered and the price range for the proposed offering have not yet been determined. The initial public offering is expected to take place after the SEC completes its review process, subject to market and other conditions.”

No timeline has been given for the IPO, however, the company has long debated making this move. The reported timeframe is before the end of the year, but that could yet be dependent on how the coronavirus pandemic develops over the coming months.

Following the outbreak, Airbnb sought to raise funds to secure its future and in April, it completed a debt facility, worth £1.6bn – which as a consequence valued the business at more than £12bn. This showed that the company had lost over a third of its value, prior to the outbreak.

Andrea Walne, general partner at Manhattan Venture Partners, an Airbnb investor said: “The company may be thinking that the lost value they’ve realised in 2020 could be recouped as a public company and that will be reflected in the upside in their stock price.”

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