Reddit is targeting up to US$6.5 billion valuation in IPO

Reddit is eyeing a valuation of as much as US$6.5 billion in its initial public offering (IPO), according to a person familiar with the matter.

The social media company plans to target a price range of US$31 to US$34 per share in the first-time share sale, the person said, asking not to be identified because the information is private. 

At that price range, Reddit would have a fully diluted value of about US$6 billion to US$6.5 billion, the person said. 

Reddit’s offering is being led by Morgan Stanley, Goldman Sachs Group, JPMorgan Chase and Bank of America, according to its filings with the US Securities and Exchange Commission. 

Details of the offering including the size and timing could change, the person said. Representatives for Morgan Stanley, Goldman Sachs, JPMorgan and Bank of America declined to comment.

The price range and valuation were reported earlier by The Wall Street Journal, which said Reddit intends to allow some employees to sell stock in the IPO.

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Reddit was weighing feedback from early meetings with potential IPO investors that it should consider a valuation of at least US$5 billion, Bloomberg News reported in January. The company was targeting a valuation in the mid-single-digit billions, people familiar with the matter said at the time.

The valuations under consideration would be a significant retreat from those seen in tech’s pandemic-era heyday. In 2021, Reddit raised funds valuing it at US$10 billion, and Bloomberg News reported the following year that the company could potentially have been valued as much as US$15 billion in an IPO.

The company plans for its shares to trade on the New York Stock Exchange under the symbol RDDT. BLOOMBERG