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Snapchat said to pick Morgan Stanley, Goldman to lead IPO

Thursday, October 13, 2016 - 07:40
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Snapchat has chosen bankers for its initial public offering, which could happen as soon as March, according to people familiar with the matter.

NEW YORK] Snapchat has chosen bankers for its initial public offering, which could happen as soon as March, according to people familiar with the matter.

Morgan Stanley and Goldman Sachs Group Inc will lead the offering and were notified of their role early this week, said the people, who asked not to be named because the information isn't public. JPMorgan Chase & Co, Deutsche Bank AG, Allen & Co, Barclays Plc and Credit Suisse Group AG will also be involved as joint book runners, the people said.

Snapchat, which recently changed its corporate name to Snap Inc, makes an application for sharing selfies and videos, watching news videos and chatting with friends. It has more than 150 million daily active users and aims to generate more than US$350 million in advertising revenue this year, up from US$59 million in 2015, people familiar with its plans have said.

Because the company's revenue is less than US$1 billion, it qualifies to file IPO documents confidentially with the US Securities and Exchange Commission.

Snap, with a private market value of US$18 billion after its last funding round, will be the largest social media IPO since Twitter Inc in November 2013. Los Angeles-based Snap plans to go public even as other large startups, such as Uber Technologies Inc and Airbnb Inc, take more time, raising private capital or borrowing money instead.

Morgan Stanley's lead role comes after the bank arranged a credit facility for Snap in September. Snap's sale is poised to be the biggest US technology IPO that Morgan Stanley has served as left-lead adviser on since Facebook Inc went public in 2012.

Mary Ritti, a spokeswoman for Snapchat, declined to comment, as did representatives for Goldman Sachs, Credit Suisse, Barclays and Deutsche Bank.

Representatives for Morgan Stanley, JPMorgan and Allen & Co didn't immediately respond to requests for comment.

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