Uber announced Thursday that its initial public offering of 180 million shares of its common stock would be priced at $45 USD per share.
Based on the amount of stock outstanding after the offering, the IPO price gives San Francisco-based Uber a market value of $75.5 billion USD, just below its last private market value of $76 billion. The fully diluted value, including restricted stock units and other shares, could be about $82 billion USD.
At that valuation, Uber is worth almost as much as Ford and General Motors combined. It will also have a valuation just above Goldman Sachs and be significantly larger than the electric-car maker Tesla. It is almost five times as valuable as rival ride-hailing company Lyft.
At that price, Uber announced, it would raise $8.1 billion USD to fund expansion into new markets and the continued development of expensive projects such as its driverless car and food-delivery divisions.
But it had hoped for a higher valuation. Appetite for the stock is thought to have been dampened by the limp performance of shares in rival Lyft, which floated in March and has since lost 27% of its IPO strike price.
“We view Uber’s conservative pricing as a smart and prudent strategy coming out of the box as it clearly learned from its ‘little brother’ Lyft, and the experience it has gone through over the past month,” Wedbush Securities analyst Dan Ives said.
The IPO pricing was a balancing act for Uber’s team of underwriting banks, led by Morgan Stanley, Goldman Sachs, and Bank of America Merrill Lynch, to negotiate a good price while leaving some upside to ensure the stock trades up on its market debut.
The ride-hailing service is expected to begin trading on the New York Stock Exchange on Friday under the symbol “UBER.”