The New York Stock Exchange said Tuesday night that Roblox’s reference price, which goes public tomorrow, is $ 45 per share.
With around 652 million shares outstanding, the benchmark price indicates that Roblox’s market capitalization could reach $ 29.3 billion.
Roblox will trade on the New York Stock Exchange on Wednesday under the symbol RBLX. Roughly 199 million Roblox shares will hit the market, but unlike a traditional IPO, the company is not raising new capital through the offering. Instead, holders will sell shares they already own.
The $ 45 reference price does not mean that this is where Roblox shares will start trading. Rather, it is intended to be a guide that informs the public about recent private business activity, according to a person familiar with the situation.
Direct listings aren’t new, but they’ve been getting attention lately. Roblox will be the fifth company to go public using this method.
Palantir Technologies (ticker: PLTR), Asana (ASAN), Slack Technologies (WORK) and Spotify Technology (SPOT) used direct listings to make their debut on the public stock market. Companies don’t typically raise capital through direct listings, although in December the Securities and Exchange Commission approved a rule change proposed by the NYSE that allows a company to do so.
Roblox will not receive a profit from shareholders who sell their shares.
Bank of America
They are advising Roblox on the deal.
When Spotify went public on the New York Stock Exchange in 2018, its reference price was at the level of the latest private secondary trades. On Slack’s 2019 listing, the benchmark was closely informed by the volume-weighted average price of recent secondary business activity, but it was not the exact average, the person said.
Unlike the price range set by the subscribers of a traditional IPO, which is generally a reasonable indicator of the offer price, the reference price is not particularly useful as an indicator of where a directly traded stock will trade.
Both Palantir and Asana went public in September using direct listings. Palantir’s reference price was $ 7.25, but the stock opened at $ 10 on September 30, peaked at $ 11.42 and closed at $ 9.50. While Asana’s reference price was $ 21, it opened at $ 27, peaked at $ 29.96, and ended at $ 28.80.
Founded in 2004, Roblox is home to children’s games centered on digital characters that resemble Lego blocks. An average of 37.1 million people come to Roblox daily to play.
Roblox is not profitable. Losses increased to $ 253.3 million for 2020, compared to $ 71 million in 2019. Revenue increased almost 82%, to $ 923.9 million. David Baszucki, co-founder, president and CEO of Roblox, has 70.1% of the total voting power, according to the prospectus.
Write to Luisa Beltran at [email protected]