Twitter to take 70m shares to market for between $17 and $20

Twitter IPO

Twitter IPO

The puzzle pieces of Twitter’s IPO are starting to come together and form a complete picture.

The latest piece of information is that the social network will take around 70-million shares to market when it lands on the New York Stock Exchange and will look to sell them for between US$17 and US$20 a pop.

The revelation is an important one, and not just because those are the numbers people have been curious about since Twitter formally announced its intention to go public back in September.

It also means that we now have a more complete indication of how much money the company is looking to raise with the IPO: around US$1.4-billion.

That would make it the biggest web-based IPO since Facebook although, as expected, it’ll be substantially smaller than its big blue rival’s arrival on the NASDAQ last year.

Nonetheless, the company has shown all the signs of trying to avoid Facebook’s fate, most notably by choosing to file on the less volatile NYSE.

According to Bloomberg, the IPO will see Twitter valued at US$10.9-billion if share sales go through at the top of the range.

One thing that could leave investors and Twitter’s private shareholders jittery though is the fact that, unlike Facebook pre IPO, the company has yet to turn a profit.

That said, it hasn’t tried to lure in investors with an overly optimistic SEC filing, laying out the challenges it faces for everyone to see.

As Memeburn columnist Hilton Tarrant noted a few weeks ago, it does have an ace up its sleeve that Facebook didn’t at the time of its IPO.

Twitter gets mobile, it always has, because mobile has always been at the core of the Twitter experience. If it can convince investors and shareholders that it’ll be able to turn this understanding into advertising profit, then it should have a much smoother ride.

Facebook, remember, only managed to get its shares on even keel nearly a year after it went public and only after it proved to the world that its mobile advertising model was working.

According to Bloomberg, more than 70% of Twitter’s advertising revenue comes from mobile devices, a substantially higher proportion than Facebook’s.

At this stage, it’s unclear where Twitter will direct the money it manages to raise in the filing, although Bloomberg suggests that expanding further into international territories and proving to investors that it can draw in increased ad revenue will be priority.

The IPO will also see the shares belonging to the company’s co-founders deleted a little. Most visibly, Ev Williams will go from owning 12% of the company to around 10%, although he will remain the biggest individual shareholder.



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