AAA Lyft revs up IPO filing

Lyft revs up IPO filing

US-based ride hailing service Lyft filed for an initial public offering on Friday that would enable investors including corporates Alphabet, Rakuten, Alibaba, General Motors, Tencent and Didi Chuxing to exit.

The company has set an initial target of $100m for the offering that will inevitably be upscaled when it sets the terms for the IPO, which is set to take place on the Nasdaq Global Select Market.

Lyft runs an app-based service that provided rides to 30.7 million users in 2018, across more than 300 urban US and Canadian markets, generating $8.1bn in bookings. It made a $911m net loss in 2018 while effectively doubling its revenue year on year to more than $2.15bn.

The IPO will follow a reported $4.4bn of equity financing, $250m of which came in a 2014 series D round featuring e-commerce group Alibaba, Andreessen Horowitz, Coatue Management, Founders Fund, Mayfield Fund and Third Point Ventures.

E-commerce firm Rakuten invested $300m to lead the $530m first tranche of Lyft’s series E round, which closed at $680m in 2015, at a $2.5bn valuation. Diversified holding company Icahn Enterprises invested $100m in the second close while unnamed existing investors also took part.

The company secured $1bn at a $5.5bn post-money valuation in 2016, $500m of which came from carmaker General Motors (GM) while the rest was supplied by Alibaba, Rakuten, Chinese ride hailing service Didi Chuxing (then known as Didi Kuaidi), Kingdom Holding and Janus Capital Management.

Rakuten put $200m into a $600m round in 2017 also backed by Janus Capital, Baillie Gifford, AllianceBernstein, PSP Investments and KKR’s Next Generation Technology Fund, at a $7.5bn valuation, and automotive manufacturer Jaguar Land Rover invested $25m shortly afterwards.

Lyft raised an amount reported to be $1.5bn in late 2017, from CapitalG, a subsidiary of internet technology group Alphabet, as well as Rakuten, AllianceBernstein, Baillie Gifford, KKR, Janus Henderson, Fidelity Investments and Ontario Teachers’ Pension Plan, at an $11.5bn post-money valuation.

The IPO filing however places the size of the total raised in the round at $727m, and the size of CapitalG and Rakuten’s investments at $500m and $200m respectively. Automotive components provider Magna International agreed in March 2018 to provide a further $200m in funding for Lyft as part of a long-term collaboration agreement.

Fidelity Investments owner Fidelity Management and Research subsequently invested $443m as part of a $600m round that also featured Senator Investment Group, at a $15.1bn valuation, in June 2018.

Rakuten is Lyft’s largest shareholder, with a stake sized at just over 13%, while GM owns 7.8%, Fidelity 7.7%, Andreessen Horowitz 6.3% and Alphabet 5.3%.

JP Morgan Securities, Credit Suisse Securities (USA), Jefferies, UBS Securities, Stifel, Nicolaus & Company, RBC Capital Markets and KeyBanc Capital Markets are book-running managers for the IPO, heading up a team of 29 underwriters.

Cowen and Company, Raymond James & Associates, Canaccord Genuity, Evercore Group, Piper Jaffray, JMP Securities, Wells Fargo Securities, Academy Securities, Blaylock Van, Penserra Securities and Siebert Cisneros Shank are also among the underwriters.

The list was rounded out by Williams Capital Group, CastleOak Securities, CL King & Associates, Drexel Hamilton, Great Pacific Securities, Loop Capital Markets, Mischler Financial Group, Samuel A. Ramirez & Company, R. Seelaus and Tigress Financial Partners.

By Robert Lavine

Robert Lavine is special features editor for Global Venturing.

Leave a comment

Your email address will not be published. Required fields are marked *